77586 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

1 Kaiser Family Foundation (2022), Five key 

findings on mental health and substance use 

disorders by race/ethnicity, https://www.kff.org/ 

mental-health/issue-brief/five-key-findings-onmental-health-and-substance-use-disorders-by-raceethnicity/. 

2American Psychological Association (2023), 

Stress in AmericaTM 2023: A nation grappling with 

psychological impacts of collective trauma, https:// 

www.apa.org/news/press/releases/2023/11/ 

psychological-impacts-collective-trauma. 

3 Vahratian, A., Blumberg, S.J., Terlizzi, E.P., 

Schiller, J.S. (2021), Symptoms of Anxiety or 

Depressive Disorder and Use of Mental Health Care 

Among Adults During the COVID–19 Pandemic— 

United States, Aug. 2020–Feb. 2021, MMWR Morb 

Mortal Wkly Rep 2021;70:490–494, https://

www.cdc.gov/mmwr/volumes/70/wr/ 

mm7013e2.htm. 

4SAMHSA (2023), Key substance use and mental 

health indicators in the United States: Results from 

the 2022 National Survey on Drug Use and Health 

(HHS Publication No. PEP23–07–01–006, NSDUH 

Series H–58), https://www.samhsa.gov/data/report/ 

2022-nsduh-annual-national-report. 

5 Ibid. 

6Tanz, L.J., Dinwiddie, A.T., Mattson, C.L., 

O’Donnell, J., Davis, N.L. (2022), Drug Overdose 

Deaths Among Persons Aged 10–19 Years—United 

States, July 2019–Dec. 2021. MMWR Morb Mortal 

Wkly Rep 2022;71:1576–1582, https://

www.cdc.gov/mmwr/volumes/71/wr/ 

mm7150a2.htm. 

7Han, B., Einstein, E.B., Jones, C.M., Cotto, J., 

Compton, W.M., Volkow, N.D. (2022), Racial and 

Ethnic Disparities in Drug Overdose Deaths in the 

US During the COVID–19 Pandemic, JAMA Netw 

Open, 5(9):e2232314, DOI:10.1001/ 

jamanetworkopen.2022.32314, https://www.ncbi.

nlm.nih.gov/pmc/articles/PMC9490498/. Ageadjusted death rates are death rates that control for 

the effects of differences in population age 

distributions. 

8 Ibid. 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 54 

[TD 10006] 

RIN 1545–BQ29 

DEPARTMENT OF LABOR 

Employee Benefits Security 

Administration 

29 CFR Part 2590 

RIN 1210–AC11 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

45 CFR Parts 146 and 147 

[CMS–9902–F] 

RIN 0938–AU93 

Requirements Related to the Mental 

Health Parity and Addiction Equity Act 

AGENCY: Internal Revenue Service, 

Department of the Treasury; Employee 

Benefits Security Administration, 

Department of Labor; Centers for 

Medicare & Medicaid Services, 

Department of Health and Human 

Services. 

ACTION: Final rules. 

SUMMARY: This document sets forth final 

rules amending regulations 

implementing the Paul Wellstone and 

Pete Domenici Mental Health Parity and 

Addiction Equity Act of 2008 

(MHPAEA) and adding new regulations 

implementing the nonquantitative 

treatment limitation (NQTL) 

comparative analyses requirements 

under MHPAEA, as amended by the 

Consolidated Appropriations Act, 2021 

(CAA, 2021). Specifically, these final 

rules amend the existing NQTL standard 

to prohibit group health plans and 

health insurance issuers offering group 

or individual health insurance coverage 

from using NQTLs that place greater 

restrictions on access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

As part of these changes, these final 

rules require plans and issuers to collect 

and evaluate relevant data in a manner 

reasonably designed to assess the 

impact of NQTLs on relevant outcomes 

related to access to mental health and 

substance use disorder benefits and 

medical/surgical benefits and to take 

reasonable action, as necessary, to 

address material differences in access to 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. These final rules also 

amend existing examples and add new 

examples on the application of the rules 

for NQTLs to clarify and illustrate the 

requirements of MHPAEA. 

Additionally, these final rules set forth 

the content requirements for NQTL 

comparative analyses and specify how 

plans and issuers must make these 

comparative analyses available to the 

Department of the Treasury (Treasury), 

the Department of Labor (DOL), and the 

Department of Health and Human 

Services (HHS) (collectively, the 

Departments), as well as to an 

applicable State authority, and to 

participants, beneficiaries, and 

enrollees. Finally, HHS finalizes 

regulatory amendments to implement 

the sunset provision for self-funded 

non-Federal governmental plan 

elections to opt out of compliance with 

MHPAEA, as adopted in the 

Consolidated Appropriations Act, 2023 

(CAA, 2023). 

DATES: 

Effective date: These regulations are 

effective on November 22, 2024. 

Applicability date: See the 

SUPPLEMENTARY INFORMATION section for 

information on the applicability dates. 

FOR FURTHER INFORMATION CONTACT: 

William Fischer, Internal Revenue 

Service, Department of the Treasury, at 

202–317–5500; Beth Baum or David 

Sydlik, Employee Benefits Security 

Administration, Department of Labor, at 

202–693–8335; David Mlawsky, Centers 

for Medicare & Medicaid Services, 

Department of Health and Human 

Services, at 410–786–6851. 

SUPPLEMENTARY INFORMATION: 

I. Background 

America continues to experience a 

mental health and substance use 

disorder crisis affecting people across 

all demographics, with marginalized 

communities disproportionately 

impacted.1 The COVID–19 pandemic 

exacerbated the crisis, but its effects 

have continued post-pandemic.2 From 

August 19, 2020, to February 1, 2021, 

the percentage of adults exhibiting 

symptoms of an anxiety or a depressive 

disorder rose from 36.4 percent to 41.5 

percent.3 In 2022, there were an 

estimated 15.4 million adults aged 18 or 

older in the United States with a serious 

mental illness and nearly one in four 

adults (59.3 million) living with any 

mental illness.4

Additionally, in 2022, nearly 54.6 

million people aged 12 or older were 

classified as needing treatment for 

substance use, but only about 24 percent 

of those people received any treatment, 

according to the Substance Abuse and 

Mental Health Services 

Administration’s (SAMHSA) National 

Survey on Drug Use and Health 

(NSDUH).5 The unmet need for 

treatment for substance use disorders 

has been even greater among racial 

minorities and other marginalized 

communities. Between 2019 and 2021, 

median monthly overdose deaths among 

persons aged 10–19 years increased 109 

percent; and deaths involving illicitly 

manufactured fentanyl increased 182 

percent.6 In 2021, American Indian and 

Alaskan Native men aged 15–34 had an 

age-adjusted death rate caused by drug 

overdoses of 42 per 100,000 people, 

compared to 20.5 age-adjusted deaths 

per 100,000 people during the same 

time period in 2018.7 Non-Hispanic 

Black or African American men aged 

35–64 had an age-adjusted death rate 

caused by drug overdoses of 61.2 per 

100,000 people; an increase from 30.6 

deaths per 100,000 people during the 

same time period in 2018.8

Following the COVID–19 pandemic, 

employers highlighted that they have 

responded to the impact of the 

pandemic on the mental health and 

substance use disorder crisis by offering 

more comprehensive benefits, including 


khammond on DSKJM1Z7X2PROD with RULES2
Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77587 

9Coe, E., Cordina, J., Enomoto, K., Mandel, A., 

Stueland, J. (2021), National Surveys Reveal 

Disconnect Between Employees and Employers 

Around Mental Health Need, McKinsey & 

Company, https://www.mckinsey.com/industries/ 

healthcare/our-insights/national-surveys-revealdisconnect-between-employees-and-employersaround-mental-health-need. 

10America’s Health Insurance Plans (AHIP), 

Health Insurance Providers Facilitate Broad Access 

to Mental Health Support (Aug. 2022), https://

ahiporg-production.s3.amazonaws.com/documents/ 

Mental-Health-Survey-July-2022-FINAL.pdf. 

11Consistent with the proposed rules, these final 

rules apply directly to group health plans or health 

insurance coverage offered by an issuer in 

connection with a group health plan, and apply to 

individual health insurance coverage by crossreference through 45 CFR 147.160, which currently 

provides that the requirements of 45 CFR 146.136 

apply to health insurance coverage offered by a 

health insurance issuer in the individual market in 

the same manner and to the same extent as to health 

insurance coverage offered by a health insurance 

issuer in connection with a group health plan in the 

large group market. As noted later in this preamble, 

HHS is finalizing an amendment to 45 CFR 147.160 

to also include a cross-reference to 45 CFR 146.137 

to similarly extend the new comparative analysis 

requirements to individual health insurance 

coverage in the same manner and to the same extent 

as group health insurance coverage. For simplicity, 

this preamble generally refers only to the 

applicability to group health plans and health 

insurance coverage offered in connection with a 

group health plan and to participants and 

beneficiaries enrolled in such a plan or coverage, 

but references to participants and beneficiaries 

should also be considered to include enrollees in 

the individual market, unless otherwise specified. 

12 88 FR 51552, 51554 (Aug. 3, 2023). 

13Melek, S., Davenport, S., Gray, T.J. (2019), 

Addiction and mental health vs. physical health: 

Widening disparities in network use and provider 

reimbursement, Milliman, 6, https://assets.

milliman.com/ektron/Addiction_and_mental_

health_vs_physical_health_Widening_disparities_

in_network_use_and_provider_reimbursement.pdf. 

14Mark, T.L., Parish, W. (2024), Behavioral health 

parity—Pervasive disparities in access to innetwork care continue, RTI International, https://

dpjh8al9zd3a4.cloudfront.net/publication/

behavioral-health-parity-pervasive-disparitiesaccess-network-care-continue/fulltext.pdf. 

15 Id. at 46. 

16 In a floor statement, Representative Patrick 

Kennedy (D–RI), one of the chief architects of 

MHPAEA, made the case for its passage on the 

grounds that ‘‘access to mental health services is 

one of the most important and most neglected civil 

rights issues facing the Nation. For too long, 

persons living with mental disorders have suffered 

from discriminatory treatment at all levels of 

society.’’ 153 Cong. Rec. S1864–5 (daily ed. Feb. 12, 

2007). Cf. H. Rept. 110–374, part 3 (Mar. 4, 2008), 

https://www.congress.gov/congressional-report/ 

110th-congress/house-report/374 (‘‘The purpose of 

H.R. 1424, the ‘Paul Wellstone Mental Health and 

Addiction Equity Act of 2007’ is to have fairness 

and equity in the coverage of mental health and 

substance-related disorders vis-a-vis coverage for 

medical and surgical disorders.’’). 

17 88 FR 51552 (Aug. 3, 2023). 

18 Internal Revenue Code (Code) section 

9812(a)(3)(A), Employee Retirement Income 

Security Act of 1974 (ERISA) section 712(a)(3)(A), 

and Public Health Service Act (PHS Act) section 

2726(a)(3)(A). 

19See, e.g., 2022 MHPAEA Report to Congress 

(Jan. 2022), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/laws/mental-healthparity/report-to-congress-2022-realizing-parityreducing-stigma-and-raising-awareness.pdf; 2023 

MHPAEA Comparative Analysis Report to Congress 

(July 2023), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/laws/mental-healthparity/report-to-congress-2023-mhpaeacomparative-analysis.pdf. 

20More information on the Departments’ 

enforcement efforts and guidance issued under 

MHPAEA is available at https://www.dol.gov/ 

agencies/ebsa/laws-and-regulations/laws/mentalhealth-and-substance-use-disorder-parity/toolsand-resources and https://www.cms.gov/ 

marketplace/private-health-insurance/mentalhealth-parity-addiction-equity. 

21As discussed in more detail later in this 

preamble, NQTLs are generally non-numerical 

limits on the scope or duration of treatment, such 

as prior authorization requirements, step therapy, 

and standards related to network composition. 

mental health support. According to a 

report published in 2021, ‘‘about three 

in four large employers and two in four 

small/medium employers report that 

they offer at least one type of mental 

health support for employees.’’ 9 In a 

recent survey, 87 percent of large 

employers stated that access to mental 

health care was a top priority, and 

another survey found that ‘‘the number 

of in-network behavioral health 

providers has increased by an average of 

48 percent in 3 years among commercial 

health plans.’’ 10 Group health plans and 

health insurance issuers have taken 

steps to ensure mental health parity is 

reflected in their benefit designs and to 

educate participants, beneficiaries, and 

enrollees 11 about MHPAEA’s 

requirements, by reaching out to 

members, expanding telehealth 

availability, expanding behavioral 

health provider networks, integrating 

behavioral health with physical health 

care, and working to reduce 

stigmatization of seeking treatment. 

Despite these efforts, disparities in 

coverage between mental health and 

substance use disorder benefits and 

medical/surgical benefits have grown. In 

the preamble to the proposed rules,12

the Departments cited a 2019 Milliman 

report 13 that found a growing disparity 

in the utilization of out-of-network 

behavioral health care providers relative 

to out-of-network medical/surgical care 

providers. A recent study by RTI 

International 14 found that out-ofnetwork use was 3.5 times higher for all 

behavioral health clinician office visits 

than for all out-of-network medical/ 

surgical clinician office visits; in 

addition, the study noted that these 

disparities in out-of-network use for 

behavioral health office visits compared 

to medical/surgical office visits have 

remained large and, according to the 

study, are not fully attributable to 

behavioral health provider shortages. 

The study concluded that these results 

demonstrate the need for more robust 

parity enforcement. 

RTI concluded that its analyses of the 

most recent, comprehensive private 

insurance claims data 

reveal material differences in access to 

mental health and substance use disorder 

benefits as compared to medical/surgical 

benefits, as reflected in much greater use of 

out-of-network providers. . . . These 

disparities indicate that behavioral health 

networks are clearly inadequate and signal 

potential noncompliance with the NQTL 

requirements of MHPAEA.15

These final rules aim to strengthen 

consumer protections consistent with 

MHPAEA’s fundamental purpose—to 

ensure that individuals in group health 

plans or with group or individual health 

insurance coverage who seek treatment 

for covered mental health conditions or 

substance use disorders do not face 

greater burdens on access to benefits for 

those conditions or disorders than they 

would face when seeking coverage for 

the treatment of a medical condition or 

a surgical procedure.16 As highlighted 

in the preamble to the proposed rules,17

such barriers are particularly 

problematic when the benefits that the 

plan or issuer purports to make 

available and that individuals 

reasonably expect to be covered are not 

in fact covered. To the extent these 

barriers disproportionately limit access 

to mental health or substance use 

disorder benefits, such practices 

contravene MHPAEA’s statutory 

language, which requires that the 

financial requirements and treatment 

limitations applicable to mental health 

or substance use disorder benefits be 

‘‘no more restrictive’’ than the 

predominant requirements and 

limitations applicable to substantially 

all medical/surgical benefits.18 The 

Departments’ enforcement efforts have 

shown that such barriers persist more 

than 15 years after MHPAEA’s 

enactment.19 These final rules are 

critical to addressing barriers to access 

to mental health and substance use 

disorder benefits. 

The problems persist notwithstanding 

the Departments’ unprecedented 

commitment to advance parity for 

mental health and substance use 

disorder benefits in recent years, as 

reflected through increased enforcement 

efforts and the Departments’ work with 

interested parties to help them 

understand and comply with 

MHPAEA’s requirements.20 To promote 

compliance, the Departments have 

provided extensive guidance and 

compliance assistance materials, 

especially with respect to NQTLs,21 yet 

disparities still persist. 

In 1996, Congress enacted the Mental 

Health Parity Act of 1996 (MHPA 1996), 

which required parity in aggregate 


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77588 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

22Public Law 104–204, 110 Stat. 2874 (Sept. 26, 

1996). The Departments published interim final 

rules implementing MHPA 1996 at 62 FR 66932 

(Dec. 22, 1997). 

23The Departments published interim final rules 

implementing MHPA 1996 at 62 FR 66932 (Dec. 22, 

1997). 

24Sections 511 and 512 of the Tax Extenders and 

Alternative Minimum Tax Relief Act of 2008 

(Division C of Pub. L. 110–343, 122 Stat. 3765 (Oct. 

3, 2008)). 

25References to the Affordable Care Act or ACA 

include the Patient Protection and Affordable Care 

Act (Pub. L. 111–148, 123 Stat. 3028) enacted on 

March 23, 2010, and the Health Care and Education 

Reconciliation Act of 2010 (Pub. L. 111–152, 124 

Stat. 1029) enacted on March 30, 2010. 

26The requirements of MHPAEA generally apply 

to both grandfathered and non-grandfathered health 

plans. See section 1251 of the ACA and its 

implementing regulations at 26 CFR 54.9815–1251, 

29 CFR 2590.715–1251, and 45 CFR 147.140. Under 

section 1251 of the ACA, grandfathered health 

plans are exempted only from certain ACA 

requirements enacted in Subtitles A and C of Title 

I of the ACA. The provisions extending MHPAEA 

requirements to individual health insurance 

coverage and requiring that qualified health plans 

comply with MHPAEA are not included in these 

sections. However, because MHPAEA requirements 

apply to health insurance coverage offered in the 

small group market only through the requirement 

to provide EHB, which does not apply to 

grandfathered health plans, the requirements of 

MHPAEA do not apply to grandfathered health 

plans offered in the small group market. 

27A qualified health plan is a health insurance 

plan that is certified by a health insurance exchange 

that it meets certain minimum standards 

established under the ACA and described in 

subpart C of 45 CFR part 156. See 45 CFR 155.20. 

28Section 1302 of the ACA requires nongrandfathered health plans in the individual and 

small group markets to cover EHB, which include 

items and services in the following ten benefit 

categories: (1) ambulatory patient services; (2) 

emergency services; (3) hospitalization; (4) 

maternity and newborn care; (5) mental health and 

substance use disorder services, including 

behavioral health treatment; (6) prescription drugs; 

(7) rehabilitative and habilitative services and 

devices; (8) laboratory services; (9) preventive and 

wellness services and chronic disease management; 

and (10) pediatric services, including oral and 

vision care. See 45 CFR 156.115 for description of 

the benefits a health plan must provide to provide 

EHB. 

29Section 1302(b)(1)(E) of the ACA; 45 CFR 

156.115(a)(3). 

30 74 FR 19155 (Apr. 28, 2009). 

31 75 FR 5410 (Feb. 2, 2010). 

32 78 FR 68240 (Nov. 13, 2013). 

33See Self-Compliance Tool for the Mental 

Health Parity and Addiction Equity Act (MHPAEA) 

(2020), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/laws/mental-healthparity/self-compliance-tool.pdf. 

34 88 FR 51552, 51555–56 (Aug. 2, 2023). 

35Section 203 of title II of Division BB of the 

CAA, 2021, Public Law 116–260, 134 Stat. 1182 

(Dec. 27, 2020). 

36The report must state, in part, whether each 

plan or issuer that submitted a comparative analysis 

upon request submitted sufficient information to 

permit review; whether and why the Departments 

determined the plan or issuer is in compliance with 

MHPAEA; the specific information each plan or 

issuer needed to submit to allow for a review of its 

comparative analysis; and, for each plan or issuer 

the Departments determined not to be in 

compliance, specifications of the actions that the 

plan or issuer must take to come into compliance. 

See Code section 9812(a)(8)(B)(iv), ERISA section 

712(a)(8)(B)(iv), and PHS Act section 

2726(a)(8)(B)(iv). 

37FAQs about Mental Health and Substance Use 

Disorder Parity Implementation and the 

Consolidated Appropriations Act, 2021 Part 45 

(Apr. 2, 2021), https://www.dol.gov/sites/dolgov/ 

files/EBSA/about-ebsa/our-activities/resourcecenter/faqs/aca-part-45.pdf and https://

www.cms.gov/cciio/resources/fact-sheets-and-faqs/ 

downloads/mhpaea-faqs-part-45.pdf. 

38 88 FR 51552, 51562 (Aug. 3, 2023). 

lifetime and annual dollar limits for 

mental health benefits and medical/ 

surgical benefits for group health plans 

and health insurance coverage offered in 

connection with such plans.22 These 

mental health parity provisions were 

codified in Code section 9812, ERISA 

section 712, and PHS Act section 

2705.23 Congress expanded on these 

efforts in 2008 with the enactment of 

MHPAEA,24 which amended Code 

section 9812, ERISA section 712, and 

PHS Act section 2705 by adding 

requirements for plans and issuers 

related to financial requirements and 

treatment limitations and made further 

amendments to the existing mental 

health parity provisions, including 

provisions to apply the mental health 

parity requirements to substance use 

disorder benefits. 

The Affordable Care Act (ACA) 25

reorganized, amended, and added to the 

provisions of part A of title XXVII of the 

PHS Act relating to group health plans 

and health insurance issuers in the 

group and individual markets. The ACA 

added section 715(a)(1) to ERISA and 

section 9815(a)(1) to the Code to 

incorporate the provisions of part A of 

title XXVII of the PHS Act into ERISA 

and the Code, and to make them 

applicable to group health plans and 

health insurance issuers providing 

health insurance coverage in connection 

with group health plans. The PHS Act 

sections included by these references 

are sections 2701 through 2728. The 

ACA extended MHPAEA to apply to 

individual health insurance coverage 

and redesignated MHPAEA in the PHS 

Act as section 2726.26 Additionally, 

section 1311(j) of the ACA applies PHS 

Act section 2726 to qualified health 

plans 27 in the same manner and to the 

same extent as it applies to health 

insurance issuers and group health 

plans. The ACA also included a 

requirement for coverage of mental 

health and substance use disorder 

services, including behavioral health 

treatment, as a category of essential 

health benefits (EHB).28 HHS’ EHB 

regulations require health insurance 

issuers offering non-grandfathered 

health insurance coverage in the 

individual and small group markets to 

comply with MHPAEA and its 

implementing regulations to satisfy the 

requirement to cover ‘‘mental health 

and substance use disorder services, 

including behavioral health treatment,’’ 

as part of EHB.29

The Departments published a request 

for information soliciting comments on 

issues under MHPAEA 30 and 

subsequently issued interim final 

regulations to implement the 

requirements of MHPAEA.31 After 

considering the comments, the 

Departments published the 2013 final 

regulations.32 As detailed in the 

preamble to the proposed rules, in the 

years after the 2013 final regulations 

were published, the Departments 

provided extensive guidance and 

compliance assistance materials to the 

regulated community, State regulators, 

and other interested parties to facilitate 

the implementation and enforcement of 

MHPAEA, including the 2020 MHPAEA 

Self-Compliance Tool,33 which 

provided a basic framework for plans 

and issuers to assess whether their 

NQTLs satisfy MHPAEA’s parity 

requirements.34

The CAA, 2021 was enacted by 

Congress on December 27, 2020,35 and 

amended MHPAEA, in part, by 

expressly requiring group health plans 

and health insurance issuers that 

provide both medical/surgical benefits 

and mental health or substance use 

disorder benefits to perform and 

document comparative analyses of the 

design and application of NQTLs that 

apply to mental health or substance use 

disorder benefits. The statute also 

requires plans and issuers to make their 

analyses available to the Departments or 

applicable State authorities, upon 

request, effective February 10, 2021. 

Additionally, the CAA, 2021 sets forth 

a process by which the Departments 

must evaluate the requested NQTL 

comparative analyses and enforce the 

comparative analyses requirements and 

requires the Departments to submit 

annually to Congress and make publicly 

available a report summarizing the 

comparative analyses requested for 

review by the Departments.36

To help plans and issuers comply 

with the amendments to MHPAEA 

made by the CAA, 2021, the 

Departments issued Frequently Asked 

Questions (FAQs) About Mental Health 

and Substance Use Disorder Parity 

Implementation and the Consolidated 

Appropriations Act, 2021 Part 45 (FAQs 

Part 45).37 As detailed in the preamble 

to the proposed rules, these FAQs 

provided initial guidance to plans and 

issuers on these amendments to 

MHPAEA.38 Additionally, as required 


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39 Ibid. 

40 88 FR 51552 (Aug. 3, 2023). On July 25, 2023, 

DOL, in collaboration with HHS and the Treasury, 

also issued Technical Release 2023–01P. The 

Technical Release set out principles and sought 

public comment to inform future guidance with 

respect to the application of the proposed data 

collection and evaluation requirements to NQTLs 

related to network composition and a potential 

time-limited enforcement safe harbor for plans and 

issuers that include data in their comparative 

analyses that demonstrate they meet or exceed all 

the thresholds identified in future guidance with 

respect to NQTLs related to network composition. 

The Departments encouraged interested parties to 

submit their comments consistent with the 

instructions contained in it separate from any 

comments they submitted in response to the 

proposed rules. The Departments are considering 

these comments separately and these final rules do 

not respond to those comments. Plans and issuers 

would be allowed adequate time to conform to any 

future guidance on the type, form, and manner of 

collection and evaluation for the relevant data 

required under the final rules. 

41 88 FR 66728 (Sept. 28, 2023). 

42The comment period for the proposed rules 

was extended by 15 days to October 17, 2023. 

43The Departments note that impacts on plan and 

issuer costs are discussed in more detail in the 

regulatory impact analysis, later in this preamble. 

by the CAA, 2021, the Departments 

provided reports to Congress on the 

NQTL comparative analyses reviews 

conducted by the Departments.39 These 

reports highlighted that nearly all of the 

comparative analyses reviewed by the 

Departments during the relevant time 

periods contained insufficient 

information to support a finding of 

compliance upon initial receipt and 

reflected common insufficiencies. 

Building on the lessons learned from 

implementing and enforcing MHPAEA, 

as well as the guidance provided in 

FAQs Part 45, on August 3, 2023, the 

Departments published proposed rules 

to amend existing MHPAEA regulations 

at 26 CFR 54.9812–1, 29 CFR 2590.712, 

and 45 CFR 146.136; 40 to add a 

proposed new regulation at 26 CFR 

54.9812–2, 29 CFR 2590.712–1, and 45 

CFR 146.137 in order to codify 

minimum standards for developing 

NQTL comparative analyses; and to 

codify HHS-only amendments to 

implement the sunset provision for selffunded non-Federal governmental plan 

elections to opt out of compliance with 

MHPAEA. On September 28, 2023, the 

Departments extended the comment 

period that was set to expire on October 

2, 2023, by 15 days to October 17, 2023, 

to give interested parties additional time 

to review the proposed rules and submit 

comments.41

The Departments received 9,503 

comments that were submitted during 

the comment period 42 in response to 

the proposed rules from a wide variety 

of interested parties, including private 

citizens; consumer and advocacy 

organizations; employers, employee 

organizations, and other plan sponsors; 

Federal, State, and local officials; health 

care providers and facilities and health 

systems; health insurance issuers; 

service providers, including managed 

behavioral health organizations 

(MBHOs), third-party administrators 

(TPAs), and pharmacy benefit managers 

(PBMs); trade and professional 

associations; and researchers. Many 

commenters provided detailed feedback 

on multiple aspects of the proposed 

rules and in response to various specific 

comment solicitations included in the 

preamble to the proposed rules and the 

request for information. 

In general, many commenters 

supported the proposed rules, because 

they would formalize and, according to 

these commenters, provide greater 

clarity on what health plans and issuers 

must do to comply with MHPAEA. 

Some commenters highlighted that the 

existing rules were insufficient and that 

the proposed rules were timely and 

necessary to strengthen MHPAEA and 

ensure fair access to mental health and 

substance use disorder care. 

Commenters highlighted the importance 

of the proposed rules to participants, 

beneficiaries, and enrollees, including 

children, teens, young adults, and 

others living with mental health 

conditions and substance use disorders. 

Several other commenters, however, 

expressed either opposition or concern 

regarding the proposed rules. Several 

commenters stated that the proposed 

rules would increase health plan and 

issuer costs and reduce treatment 

quality. A few commenters 

recommended the Departments 

withdraw the proposed rules and 

initiate a new rulemaking process after 

additional input from interested parties. 

After reviewing the comments 

received during the comment period, 

the Departments are finalizing the 

proposed rules, with some changes in 

response to comments as described in 

more detail later in this preamble, to 

ensure that participants, beneficiaries, 

and enrollees can access the mental 

health and substance use disorder care 

they need without facing greater 

restrictions than when accessing 

medical and surgical care, consistent 

with the fundamental purpose of 

MHPAEA. These final rules provide 

additional clarity to plans and issuers 

on how to comply with MHPAEA’s 

requirements and, as a result, will 

strengthen the protections of MHPAEA. 

As highlighted earlier in this preamble, 

since the 2013 final regulations, the 

Departments repeatedly sought input 

from interested parties on MHPAEA’s 

requirements; therefore, the 

Departments decline to withdraw the 

proposed rules or initiate a new 

rulemaking process after soliciting 

additional input from interested parties. 

As explained throughout this preamble, 

the amendments made by these final 

rules are faithful to MHPAEA’s parity 

requirements and sensitive to the 

flexibility plans and issuers have in 

designing benefits for group health 

plans and health insurance coverage.43

Among other things, these final rules: 

• Make clear that MHPAEA requires 

that individuals will not face greater 

restrictions on access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

• Reinforce that health plans and 

issuers cannot use NQTLs, such as prior 

authorization and other medical 

management techniques, standards 

related to network composition, or 

methodologies to determine out-ofnetwork reimbursement rates, for 

mental health and substance use 

disorder benefits, that are more 

restrictive than the predominant NQTLs 

applied to substantially all medical/ 

surgical benefits in the same 

classification. 

• Require plans and issuers to collect 

and evaluate data and take reasonable 

action, as necessary, to address material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits, 

where the relevant data suggest that the 

NQTL contributes to material 

differences in access. 

• Codify the requirement in 

MHPAEA, as amended by the CAA, 

2021, that health plans and issuers 

conduct comparative analyses to 

measure the impact of NQTLs. This 

includes evaluating standards related to 

network composition, out-of-network 

reimbursement rates, and medical 

management and prior authorization 

NQTLs. 

• Prohibit plans and issuers from 

using discriminatory information, 

evidence, sources, or standards that 

systematically disfavor or are 

specifically designed to disfavor access 

to mental health and substance use 

disorder benefits when designing 

NQTLs. 

• Implement the sunset provision for 

self-funded non-Federal governmental 

plan elections to opt out of compliance 

with MHPAEA. 

As a result, the Departments 

anticipate that these final rules will 

result in changes in network 

composition and medical management 

techniques related to mental health and 

substance use disorder care, more robust 

mental health and substance use 

disorder provider networks, and fewer 


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44Non-grandfathered health insurance coverage 

offered by a health insurance issuer in connection 

with a group health plan in the small group market 

is required to comply with the requirements under 

PHS Act section 2726 to satisfy the requirement to 

provide coverage for mental health and substance 

use disorder services, including behavioral health 

treatment, as part of EHB, and as such will also be 

required to comply with the comparative analysis 

requirements finalized under 45 CFR 146.137. See 

45 CFR 156.115(a)(3). 

45 Division FF, title I, subtitle C, chapter 3, section 

1321, Public Law 117–328, 136 Stat. 4459 (Dec. 29. 

2022). 

46See Code section 9833, ERISA section 734, and 

PHS Act section 2792. 

47The six classifications of benefits listed at 26 

CFR 54.9812–1(c)(2)(ii)(A), 29 CFR 

2590.712(c)(2)(ii)(A), and 45 CFR 

146.136(c)(2)(ii)(A) include inpatient, in-network; 

inpatient, out-of-network; outpatient, in-network; 

outpatient, out-of-network; emergency care, and 

prescription drugs. Special rules for multi-tiered 

prescription drug benefits, multiple network tiers, 

and permissible sub-classifications for office visits, 

separate from other outpatient services, are 

addressed at 26 CFR 54.9812–1(c)(3)(iii), 29 CFR 

2590.712(c)(3)(iii), and 45 CFR 146.136(c)(3)(iii). 

and less restrictive prior authorization 

requirements for individuals seeking 

mental health and substance use 

disorder care, as well as provide 

additional clarity and information 

needed for plans and issuers to meet 

their obligations under MHPAEA and 

for the Departments and States to 

enforce those obligations. 

II. Overview of the Final Rules— 

Departments of the Treasury, Labor, 

and HHS 

The Departments are issuing these 

final rules to ensure that individuals 

with mental health conditions and 

substance use disorders can benefit from 

the full protections afforded to them 

under MHPAEA, while offering clear 

guidance to plans and issuers on how to 

comply with MHPAEA’s requirements. 

These final rules amend certain 

provisions of existing MHPAEA 

regulations at 26 CFR 54.9812–1, 29 

CFR 2590.712, and 45 CFR 146.136 to 

incorporate new and revised definitions 

of key terms, as well as to specify the 

steps that plans and issuers must take to 

meet their obligations under MHPAEA. 

These final rules also add new 

regulations at 26 CFR 54.9812–2, 29 

CFR 2590.712–1, and 45 CFR 146.137 

codifying minimum standards for 

developing NQTL comparative analyses 

to assess whether an NQTL, as written 

and in operation, complies with 

MHPAEA’s requirements and setting 

forth the content elements of 

comparative analyses and the period for 

plans and issuers to respond to a request 

from the Departments to submit their 

comparative analyses. Additionally, in 

these final rules, HHS finalizes an 

amendment to 45 CFR 147.160 to 

specify that the final regulations at 45 

CFR 146.137 apply to individual health 

insurance coverage offered by a health 

insurance issuer in the same manner 

and to the same extent that the 

regulations apply to health insurance 

coverage offered by a health insurance 

issuer in connection with a group health 

plan in the large group market.44

Consistent with the existing text at 45 

CFR 147.160(a), HHS is also extending 

the same requirements and framework 

outlined in the amendments to 45 CFR 

146.136 in these final rules to 

individual health insurance coverage in 

the same manner and to the same extent 

as the amendments that apply to group 

health insurance coverage. Finally, HHS 

is finalizing amendments to 45 CFR 

146.180 to reflect the sunset of the 

election option for self-funded nonFederal governmental plans to opt out of 

compliance with MHPAEA, consistent 

with changes made by the CAA, 2023 to 

PHS Act section 2722(a)(2).45

A. Amendments to Existing Regulations 

at 26 CFR 54.9812–1, 29 CFR 2590.712, 

and 45 CFR 146.136 

1. Purpose Section—26 CFR 54.9812– 

1(a)(1), 29 CFR 2590.712(a)(1), and 45 

CFR 146.136(a)(1) 

In the preamble to the proposed rules, 

the Departments stated that the 

fundamental purpose of the MHPAEA 

statute, the 2013 final regulations, and 

the proposed rules is to ensure that 

participants and beneficiaries in a group 

health plan or in group health insurance 

coverage offered by a health insurance 

issuer that offers mental health or 

substance use disorder benefits are not 

subject to greater restrictions when 

seeking those benefits than when 

seeking medical/surgical benefits under 

the terms of the plan or coverage. The 

Departments also stated that the 

fundamental purpose of MHPAEA 

should serve as the guiding principle for 

plans and issuers as they work to 

comply with the requirements of the 

law and its implementing regulations. 

Accordingly, the Departments proposed 

to add a purpose section to the 

regulations, specifying this fundamental 

purpose, and that MHPAEA and its 

implementing regulations should be 

interpreted in a manner that is 

consistent with this purpose. 

Many commenters supported the 

addition of the purpose section and the 

principles it addressed, including the 

goal of increasing access to mental 

health and substance use disorder 

benefits, to ensure equal treatment for 

mental health and substance use 

disorder benefits and medical/surgical 

benefits. A few commenters expressed 

opposition to the proposed purpose 

section, arguing that its language goes 

beyond the intent of MHPAEA (as 

Congress did not direct the Departments 

to provide a purpose in regulations, 

either initially or in later amendments). 

The purpose section is important to 

highlight the overall goals of MHPAEA 

and to emphasize that the provisions of 

the 2013 final regulations, as amended 

by these final rules, should be 

interpreted in light of these goals. 

Congress provided authority to the 

Departments to ‘‘promulgate such 

regulations as may be necessary or 

appropriate to carry out the provisions 

of’’ chapter 100 of the Code, part 7 of 

ERISA, and title XXVII of the PHS Act, 

including MHPAEA.46 MHPAEA was 

enacted to address barriers to access to 

mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits. These final 

rules implement MHPAEA’s 

requirements and provide clarifying text 

to promote compliance with the law. 

The Departments are finalizing the 

purpose section as proposed, with 

minor changes in response to 

comments. 

Several commenters requested that 

the reference to ‘‘generally comparable’’ 

medical/surgical benefits in the 

proposed purpose section be revised to 

refer to the classification of benefits. 

These commenters noted that, 

consistent with the 2013 final 

regulations, evaluation of a plan’s or 

issuer’s MHPAEA compliance is 

assessed within the relevant 

classification of benefits, and that use of 

the term ‘‘comparable,’’ which is used 

in the 2013 final regulations and 

amendments made to MHPAEA by the 

CAA, 2021 with respect to requirements 

for NQTLs, is confusing and should be 

revised. 

The Departments agree with 

commenters who noted that use of the 

term ‘‘comparable’’ can be confusing 

when used in this context, because 

compliance with the requirements for 

financial requirements, quantitative 

treatment limitations, and NQTLs has 

historically been determined within one 

of the six classifications of benefits.47

Therefore, these final rules remove the 

reference to ‘‘generally comparable’’ 

medical/surgical benefits and instead 

specify that plans and issuers must not 

design or apply financial requirements 

and treatment limitations that impose a 

greater burden on access (that is, are 

more restrictive) to mental health or 

substance use disorder benefits under 

the plan or coverage than they impose 

on access to medical/surgical benefits in 

the same classification of benefits. The 


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48Under the 2013 final regulations, the term 

‘‘medical/surgical benefits’’ means benefits with 

respect to items or services for medical conditions 

or surgical procedures, as defined under the terms 

of the plan or health insurance coverage and in 

accordance with applicable Federal and State law, 

but does not include mental health or substance use 

disorder benefits. 26 CFR 54.9812–1(a), 29 CFR 

2590.712(a), and 45 CFR 146.136(a). 

49Consistent with the statute and the 2013 final 

regulations, the Departments note that references to 

‘‘mental health and substance use disorder 

benefits’’ and ‘‘mental health or substance use 

disorder benefits’’ throughout these final rules are 

intended to have the same meaning as the terms 

‘‘mental health benefits’’ and ‘‘substance use 

disorder benefits’’ in combination. 

Departments are finalizing the purpose 

section without any other substantive 

changes, but with a few minor 

clarifications to ensure that terms are 

used consistently with and accurately 

describe other parts of these final rules. 

2. Meaning of Terms—26 CFR 54.9812– 

1(a)(2), 29 CFR 2590.712(a)(2), and 45 

CFR 146.136(a)(2) 

a. Medical/Surgical Benefits, Mental 

Health Benefits, and Substance Use 

Disorder Benefits 

Under the statute and the 2013 final 

regulations, the term ‘‘medical/surgical 

benefits’’ means benefits for medical or 

surgical services as defined under the 

terms of the plan or health insurance 

coverage but does not include mental 

health or substance use disorder 

benefits. The 2013 final regulations 

further provide that the term must be 

defined in accordance with applicable 

Federal and State law, and that any 

condition defined by the plan or 

coverage as being or as not being a 

medical/surgical condition must be 

defined to be consistent with generally 

recognized independent standards of 

current medical practice (for example, 

the most current version of the 

International Classification of Diseases 

(ICD) or State guidelines). 

The proposed rules generally retained 

the first sentence of the 2013 final 

regulations’ definition of ‘‘medical/ 

surgical benefits,’’ 48 but amended the 

definition to provide that, 

notwithstanding this first sentence, any 

condition or procedure defined by the 

plan or coverage as being or not being 

a medical condition or surgical 

procedure must be defined consistent 

with generally recognized independent 

standards of current medical practice 

(for example, the most current version 

of the ICD). Further, the proposed rules 

stated that, to the extent that generally 

recognized independent standards of 

current medical practice do not address 

whether a condition or procedure is a 

medical condition or surgical 

procedure, plans and issuers may define 

the condition or procedure as medical/ 

surgical benefits, as long as such 

definitions are in accordance with 

applicable Federal and State law. The 

Departments also proposed to remove 

the reference to State guidelines in the 

definition of the term in the 2013 final 

regulations, both to make the definitions 

more consistent with the statute, and to 

minimize situations where differences 

between generally recognized 

independent standards of current 

medical practice and State guidelines 

create conflicts and improperly limit 

protections under MHPAEA. 

The Departments also proposed to 

make similar changes to the definitions 

of ‘‘mental health benefits’’ and 

‘‘substance use disorder benefits’’ by 

amending the first sentence of each 

definition and removing the references 

to State guidelines, consistent with the 

changes described above for ‘‘medical/ 

surgical benefits.’’ 49 For purposes of the 

requirement that any condition or 

disorder defined by the plan or coverage 

as being or not being a mental health 

condition must be defined to be 

consistent with generally recognized 

independent standards of current 

medical practice, the proposed rules 

stated that the plan’s or coverage’s 

definition must include all conditions 

covered under the plan or coverage, 

except for substance use disorders, that 

fall under any of the diagnostic 

categories listed in the mental, 

behavioral, and neurodevelopmental 

disorders chapter (or equivalent 

chapter) of the most current version of 

the ICD or that are listed in the most 

current version of the American 

Psychiatric Association (APA) 

Diagnostic and Statistical Manual of 

Mental Disorders (DSM). Similarly, the 

proposed rules stated that the plan’s or 

coverage’s definition of ‘‘substance use 

disorder benefits’’ must include all 

disorders covered under the plan or 

coverage that fall under any of the 

diagnostic categories listed as a mental 

or behavioral disorder due to 

psychoactive substance use (or 

equivalent category) in the mental, 

behavioral, and neurodevelopmental 

disorders chapter (or equivalent 

chapter) of the most current version of 

the ICD or that are listed as a SubstanceRelated and Addictive Disorder (or 

equivalent category) in the most current 

version of the DSM. The proposed rules 

solicited comments on whether any 

additional clarification is needed on 

how State law may interact with the 

proposed amended definitions of 

‘‘medical/surgical benefits,’’ ‘‘mental 

health benefits’’ and ‘‘substance use 

disorder benefits.’’ 

In general, many commenters 

supported modifying these key 

definitions in existing MHPAEA 

regulations by specifying that, to be 

consistent with generally recognized 

independent standards of current 

medical practice, the terms of the plan 

or coverage must accord with 

appropriate chapters of the ICD or DSM. 

Many commenters generally supported 

requiring plans and issuers to follow the 

ICD or DSM, reasoning that both are 

generally accepted, peer-reviewed, 

nonprofit professional standards for 

diagnosis and descriptions of medical 

conditions, mental health conditions, 

and substance use disorders, and that 

following these authoritative and 

comprehensive diagnostic tools 

promotes uniform and standard 

application of MHPAEA to mental 

health conditions and substance use 

disorders. Several commenters noted 

that these changes would significantly 

improve clarity and would increase 

access to care, especially for intellectual 

and neurodevelopmental disorders, 

including dementia and autism 

spectrum disorder (ASD). Another 

commenter recommended clarifying 

whether plans and issuers are required 

to consider both the ICD and the DSM 

in categorizing benefits for the purposes 

of the proposed rules. One commenter 

added that the Departments’ proposal to 

align and clarify the definitions of 

‘‘mental health benefits’’ and ‘‘substance 

use disorder benefits’’ would ensure 

parity between the relevant terms and 

protect the application of MHPAEA for 

conditions and disorders recognized 

under independent standards of current 

medical practice. Another commenter 

expressing support reasoned that the 

proposed amendments would clearly 

specify how mental health conditions 

and substance use disorders must be 

defined for MHPAEA compliance 

purposes and minimize contradictions 

with State guidelines that now limit 

MHPAEA protections. The commenter 

also remarked that self-insured plans 

frequently include language from Statelevel mandated benefit requirements 

prevalent in the plan’s geographic area 

that may not be MHPAEA-compliant. 

Several commenters supported the 

removal of any reference to State 

guidelines to prevent situations in 

which contradictions between Federal 

and State guidelines would result in a 

loss of protections under MHPAEA. One 

commenter wrote that State law 

definitions often predate MHPAEA, may 

conflict with ICD and DSM standards, 

and should not be the operable 

standard, while others stated that State 


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50As discussed later in this preamble, the 

Departments stated in the proposed rules and 

reiterate in these final rules that ASD is a mental 

health condition for purposes of MHPAEA. 

51CMS, Frequently Asked Questions: Mental 

Health and Substance Use Disorder Parity Final 

Rule for Medicaid and CHIP (Oct. 11, 2017), Q4, 

https://www.medicaid.gov/federal-policy-guidance/ 

downloads/faq101117.pdf. 

52The final rules also permit plans and issuers to 

use applicable Federal and State law to inform their 

definitions to the extent generally recognized 

independent standards of current medical practice 

do not address whether a condition or disorder is 

a medical condition, surgical procedure, mental 

health condition, or substance use disorder. 

guidelines should not be given 

precedence over Federal regulations to 

ensure that MHPAEA’s protections are 

not subverted. However, one commenter 

urged that the Departments continue 

allowing plans and issuers to use State 

guidelines to inform the definitions of 

‘‘medical/surgical benefits,’’ ‘‘mental 

health benefits,’’ and ‘‘substance use 

disorder benefits,’’ regardless of whether 

State law is consistent with generally 

recognized independent standards of 

current medical practice. The 

commenter noted that independent 

standards of medical practice vary and 

change over time and are not 

established with the same intents and 

purposes as State laws. The commenter 

also stated that States have been the 

traditional regulators of health 

insurance issuers when it comes to 

interpretive and enforcement matters, 

even for coverage issues subject to 

Federal law (such as the ACA and 

MHPAEA). Another commenter 

supported the clarification that, when 

the DSM or ICD does not indicate 

whether a condition or disorder is a 

mental health condition or substance 

use disorder, plans and issuers may 

define the condition or disorder in 

accordance with applicable Federal and 

State law. 

In the proposed rules, the 

Departments noted that, to the extent 

applicable State law or generally 

recognized independent standards of 

current medical practice define a 

condition or disorder as a mental health 

condition or substance use disorder, 

plans and issuers must treat all benefits 

for the condition or disorder as mental 

health benefits or substance use 

disorder benefits, respectively, for 

purposes of analyzing parity and 

ensuring compliance with MHPAEA. To 

better understand interested parties’ 

concerns in implementing this 

requirement, the Departments solicited 

comments on potential challenges in 

applying MHPAEA to all benefits for a 

mental health condition or substance 

use disorder where a specific item or 

service can be furnished for both 

medical conditions or surgical 

procedures and mental health 

conditions or substance use disorders, 

and whether additional clarifications or 

modifications to the proposed 

definitions are necessary. 

In response to this comment 

solicitation, commenters identified 

several instances in which an individual 

with a mental health or substance use 

disorder diagnosis may need a 

particular treatment for that condition 

or disorder that may also be provided to 

treat a medical condition. For example, 

ASD 50 might be treated with speech and 

occupational therapy, which is also 

used to treat some medical conditions. 

Additionally, an eating disorder might 

require medical nutrition therapy, 

which could also be used to treat a 

medical condition (such as for the 

treatment of obesity or diabetes). 

Moreover, with respect to benefits for 

prescription drugs, a commenter noted 

that claims for reimbursement generally 

do not include diagnosis information. 

Some commenters explained that many 

specific prescription drugs are 

prescribed for mental health conditions 

and substance use disorders, as well as 

for medical/surgical conditions, and 

including diagnosis information would 

require a range of different entities and 

interested parties to change their current 

practice. Commenters also 

recommended several methods under 

which the rules could allow plans and 

issuers to characterize items and 

services as medical/surgical benefits, 

mental health benefits, or substance use 

disorder benefits. One commenter 

suggested items and services be 

characterized as either mental health 

benefits, substance use disorder 

benefits, or medical/surgical benefits 

based on the condition or disorder being 

treated. Similarly, another commenter 

suggested that items and services be 

characterized as mental health benefits 

or substance use disorder benefits when 

a claim’s primary diagnosis is a mental 

health condition or substance use 

disorder, respectively, as that diagnosis 

is driving the treatment provided. 

Alternatively, several commenters 

suggested the rules could be aligned 

with existing Centers for Medicare & 

Medicaid Services (CMS) guidance on 

MHPAEA compliance for Medicaid and 

the Children’s Health Insurance 

Program (CHIP) so that plans and 

issuers could use a ‘‘reasonable 

method’’ for defining services 

commonly used to treat both medical 

conditions and mental health conditions 

or substance use disorders, for example, 

by using the plan’s or issuer’s annual 

claims experience to determine its 

spending on the service in question.51

After reviewing comments received 

from interested parties, the Departments 

are finalizing the definitions of 

‘‘medical/surgical benefits,’’ ‘‘mental 

health benefits’’ and ‘‘substance use 

disorder benefits’’ as proposed. While 

plans and issuers have some discretion 

in defining mental health benefits and 

substance use disorder benefits, this 

discretion must be exercised in a 

manner that comports with generally 

recognized independent standards of 

current medical practice, and the 

definitions in these final rules include 

sufficient safeguards to protect against 

defining a benefit in a manner that 

could result in limitations on access to 

mental health or substance use disorder 

benefits that are more restrictive than 

those applicable to medical/surgical 

benefits. Further, while the Departments 

acknowledge the concern that 

independent standards of current 

medical practice change over time and 

may not have been established with the 

same intents and purposes as State law 

or State guidelines, such standards 

better ensure that plans and issuers 

define mental health conditions and 

substance use disorders in a manner 

consistent with the purposes of 

MHPAEA. The Departments agree with 

one commenter’s concern that some 

State laws, in particular, might predate 

MHPAEA. As a result, such State laws 

might not offer the same safeguards to 

access to mental health or substance use 

disorder benefits as MHPAEA. The 

Departments also note that plans and 

issuers are required to ensure that the 

definitions used in the plan or coverage 

are consistent with the appropriate 

chapters of the most current version of 

either the ICD or the DSM. 

Additionally, while States generally 

are the traditional regulators of health 

insurance issuers, with respect to 

MHPAEA, the Departments are not 

persuaded that this necessitates 

permitting plans and issuers to use 

definitions of ‘‘medical/surgical 

benefits,’’ ‘‘mental health benefits’’ and 

‘‘substance use disorder benefits’’ that 

are solely tied to applicable State law or 

guidelines. The definitions of ‘‘medical/ 

surgical benefits,’’ ‘‘mental health 

benefits,’’ and ‘‘substance use disorder 

benefits’’ in these final rules preserve 

the ability of plans and issuers to use 

applicable Federal and State law to 

inform their definitions, but only to the 

extent that those laws are consistent 

with generally recognized independent 

standards of current medical practice.52

These final rules do not make any 

changes to the proposed definitions to 

specifically address how plans and 


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53These HHS regulations implement section 212 

of the Protecting Access to Medicare Act of 2014 

by setting compliance dates for the 10th Revision 

of the ICD for diagnosis and procedure coding. 

issuers should apply MHPAEA where a 

specific item or service may be used to 

treat both medical conditions or surgical 

procedures as well as mental health 

conditions or substance use disorders. 

These final rules, like the proposed 

rules and the 2013 final regulations, 

require plans and issuers to continue to 

characterize items and services as 

medical/surgical benefits, mental health 

benefits, or substance use disorder 

benefits based on the condition or 

disorder being treated. This 

interpretation is the most appropriate 

reading of the definitions of medical/ 

surgical benefits, mental health benefits, 

and substance use disorder benefits, 

consistent with the statute and the 

purpose of MHPAEA. The Departments 

note that the existing CMS mental 

health and substance use disorder parity 

guidance for Medicaid and CHIP 

identified by several commenters 

addresses long-term services and 

supports provided through Medicaid 

and CHIP, not items and services 

covered by group health plans and 

health insurance coverage. The 

Departments reiterate that, if a plan (or 

coverage) defines a condition or 

disorder as a mental health condition or 

substance use disorder, plans and 

issuers subject to these final rules must 

treat all benefits for the condition or 

disorder as mental health benefits or 

substance use disorder benefits, 

respectively, for purposes of compliance 

with MHPAEA. The Departments 

decline to adopt the alternative methods 

suggested by commenters that plans and 

issuers might use to characterize items 

and services as medical/surgical 

benefits, mental health benefits, or 

substance use disorder benefits, as they 

may be insufficient to ensure 

consistency with generally recognized 

independent standards of current 

medical practice and in accordance with 

applicable State and Federal law. 

Furthermore, while the Departments 

acknowledge the particular challenges 

with respect to prescription drug 

benefits due to the lack of diagnostic 

information on claims for 

reimbursement, these final rules, similar 

to the 2013 final regulations, provide 

plans and issuers enough flexibility to 

make decisions about how to classify 

items and services, including 

prescription drugs, as either mental 

health benefits, substance use disorder 

benefits, or medical/surgical benefits. 

To provide guidance to plans and 

issuers on how to ensure that they 

define benefits consistent with generally 

recognized independent standards of 

current medical practice, the proposed 

rules proposed separate definitions of 

the ICD and DSM. Specifically, the 

Departments proposed that the ICD 

would be defined as the World Health 

Organization’s International 

Classification of Diseases adopted by 

HHS through 45 CFR 162.1002 or 

successor regulations, and the DSM 

would be defined as the APA’s 

Diagnostic and Statistical Manual of 

Mental Disorders. The proposed 

definitions also specified, for purposes 

of the definition, which version of the 

ICD or DSM is the most current as of a 

particular date. This was intended to 

provide clarity on when a plan or issuer 

would be required to begin to rely on a 

new version of the ICD or DSM after it 

is released and allow sufficient time 

after the adoption of an updated version 

of the ICD or DSM for a plan or issuer 

to update the terms of its plan or 

coverage to be consistent with any 

changes made from the previous 

version. The proposed definitions stated 

that the most current version of the ICD 

or DSM, respectively, would be the 

version applicable no earlier than the 

date that is 1 year before the first day 

of the applicable plan year; however, 

the proposed rules would permit the use 

of an updated version before the plan or 

issuer is required to use it. Finally, in 

recognition of the fact that future 

versions of the ICD or DSM may include 

revisions to the categories of conditions 

or disorders or chapters listed in the 

proposed amended definitions for 

‘‘mental health benefits’’ and ‘‘substance 

use disorder benefits,’’ the proposed 

amended definitions referred to 

‘‘equivalent categories’’ and ‘‘equivalent 

chapters.’’ 

The Departments received several 

comments on the proposed definitions 

of the terms ‘‘ICD’’ and ‘‘DSM,’’ with 

some commenters suggesting 

alternatives to the language identifying 

the most current versions of the DSM 

and ICD. One commenter suggested 

specifying that if a new version of the 

DSM or ICD is published in the middle 

of a plan year, then plans and issuers 

must use the updated version by the 

start of the next plan year. One 

commenter suggested that the most 

current version of an independent 

standard should encompass any version 

commonly in use among providers, and 

any version used in the most recent 

claims experience available to plans and 

issuers. 

The Departments are finalizing the 

definition of ‘‘ICD’’ as proposed, with 

clarifications with respect to the most 

current version of the ICD. Specifically, 

under these final rules, the most current 

version of the ICD as of November 22, 

2024, the effective date of these final 

rules, is the International Classification 

of Diseases, 10th Revision, Clinical 

Modification adopted for the period 

beginning on October 1, 2015, through 

HHS regulations at 45 CFR 162.1002 (or 

successor regulations).53 Any 

subsequent version of the ICD adopted 

through 45 CFR 162.1002 (or successor 

regulations) after November 22, 2024, 

will be considered the most current 

version beginning on the first day of the 

plan year that is one year after the date 

the subsequent version is adopted. 

The Departments are also finalizing 

the definition of ‘‘DSM’’ as proposed, 

with similar clarifications, which note 

that the most current version as of 

November 22, 2024, the effective date of 

these final rules, is the Diagnostic and 

Statistical Manual of Mental Disorders, 

Fifth Edition, Text Revision published 

in March 2022. A subsequent version of 

the DSM published after November 22, 

2024, will be considered the most 

current version beginning on the first 

day of the plan year that is one year 

after the date the subsequent version is 

published (as the DSM is published, 

rather than made applicable). Consistent 

with this clarification, if a new version 

of the DSM is published in the middle 

of a plan year, plans and issuers will 

have at least one full year before they 

are required to use the updated version 

with respect to a plan year. For 

example, if a new version of the DSM 

is published on August 1, 2025, for a 

calendar year plan, that version of the 

DSM would be the most current version 

with respect to the plan year beginning 

on January 1, 2027. 

It is important to provide specificity 

with regard to the relevant versions of 

the ICD and DSM instead of allowing 

the use of multiple versions, as 

suggested by commenters, to ensure that 

plans and issuers do not select a version 

that restricts access to mental health and 

substance use disorder benefits in a 

manner that is more restrictive than 

access to medical/surgical benefits. 

Because the Departments understand 

that the ICD and DSM are both broadly 

utilized by providers and facilities, as 

well as plans and issuers, and were 

referenced in the 2013 final regulations, 

these final rules continue to rely on 

such standards. 

Finally, the preamble to the proposed 

rules noted that interested parties 

requested that the Departments confirm 

whether specific conditions are mental 

health conditions for purposes of 

MHPAEA. Consistent with the 2013 

final regulations and section 13007 of 


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54Public Law 114–255, 130 Stat. 1033 (Dec. 13, 

2016). Section 13007 of the Cures Act states that, 

if a plan or an issuer offering group or individual 

health insurance coverage provides coverage for 

eating disorder benefits, including residential 

treatment, such group health plan or health 

insurance issuer shall provide such benefits 

consistent with the requirements of MHPAEA. 

55See, e.g., DSM Disorders (5th ed.), Section II: 

Diagnostic Criteria and Codes, Feeding and Eating 

Disorders; ICD–10, Chapter V: Mental and 

behavioral disorders, Code F50: Eating disorders. 

56 DSM (5th ed.), Section II: Diagnostic Criteria 

and Codes, Autism Spectrum Disorder. 

57 DSM (5th ed.), Section II: Diagnostic Criteria 

and Codes, Gender Dysphoria; ICD–10, Chapter V: 

Mental and behavioural disorders, Code F64: 

Gender identity disorders. 

58Code section 9812(a)(8)(A), ERISA section 

712(a)(8)(A), and PHS Act section 2726(a)(8)(A). 

59The term ‘‘NQTLs related to network 

composition’’ generally refers to the NQTLs listed 

in 26 CFR 54.9812–1(c)(4)(ii)(D), 29 CFR 

2590.712(c)(4)(ii)(D), and 45 CFR 

146.136(c)(4)(ii)(D) of these final rules: standards 

related to network composition, including but not 

limited to standards for provider and facility 

admission to participate in a network or for 

continued network participation, including 

methods for determining reimbursement rates, 

credentialing standards, and procedures for 

ensuring the network includes an adequate number 

of each category of provider and facility to provide 

services under the plan or coverage. 

the 21st Century Cures Act (Cures 

Act),54 the Departments confirmed in 

the proposed rules that eating disorders, 

such as anorexia nervosa, bulimia 

nervosa, and binge-eating disorder, are 

mental health conditions under 

generally recognized independent 

standards of current medical practice.55

Similarly, the proposed rules made clear 

that, for purposes of MHPAEA, ASD is 

a mental health condition under 

generally recognized independent 

standards of current medical practice.56

Therefore, benefits for these disorders 

are considered mental health benefits, 

and subject to the protections of 

MHPAEA and its implementing 

regulations, including these final rules. 

The Departments also solicited 

comments on other specific mental 

health conditions or substance use 

disorders that may warrant additional 

clarification for purposes of analyzing 

parity and ensuring compliance with 

MHPAEA. The Departments received 

only a few comments in response, 

including a request to clarify whether 

gender dysphoria is a mental health 

condition. Because the most current 

versions of both the ICD and DSM 

include gender dysphoria as a mental 

health condition as of the time of the 

issuance of these final rules, benefits for 

this condition are currently subject to 

the protections of MHPAEA and its 

implementing regulations, consistent 

with the framework described earlier in 

this preamble.57

b. Processes, Strategies, Evidentiary 

Standards, and Factors 

The proposed rules included 

proposed new definitions of terms used 

in paragraph (c)(4)(i) of the 2013 final 

regulations, which states that a plan or 

issuer may not impose an NQTL 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 NQTL to mental health or 

substance use disorder benefits in the 

classification are comparable to, and are 

applied no more stringently than, those 

used in applying the limitation with 

respect to medical/surgical benefits in 

the same classification. These terms and 

the corresponding standard were 

incorporated into MHPAEA’s statutory 

language in the amendments made by 

the CAA, 2021.58 Because the 

Departments heard from interested 

parties prior to the issuance of the 

proposed rules that it can be difficult to 

determine what constitute relevant 

processes, strategies, evidentiary 

standards, and other factors, the 

Departments proposed definitions of 

these terms and included an illustration 

of the interaction of the definitions of 

these terms in the preamble to the 

proposed rules. The illustration 

described how a plan might rely on 

various combinations of processes, 

strategies, evidentiary standards, and 

other factors in designing and applying 

an NQTL, and gave examples of each 

term. The Departments also solicited 

comments on the proposed definitions, 

including any alternate definitions or 

additional clarifications that should be 

considered. 

In general, many commenters 

supported the proposed definitions of 

these key terms, which they described 

as foundational to the development of 

sufficient comparative analyses and 

necessary to hold plans and issuers 

accountable for discriminatory NQTLs. 

Several commenters described 

widespread misinterpretation by plans 

and issuers of the meaning of these key 

terms. Other commenters wrote that the 

proposed definitions would help clarify 

the difference between ‘‘factors’’ and 

‘‘evidentiary standards,’’ and draw a 

clear distinction between ‘‘strategies’’ 

and ‘‘processes,’’ which relate, 

respectively, to plans’ and issuers’ 

approaches to the design of an NQTL, 

and to their application of an NQTL. 

Other commenters stated that the 

definitions of these terms should clearly 

distinguish between each component of 

a plan’s or issuer’s required comparative 

analysis and assign each step of the 

analysis to a particular component of 

the comparative analysis. Additionally, 

a commenter requested more specific 

examples of processes and evidentiary 

standards, and the differences between 

factors and evidentiary standards. One 

commenter stated that the proposed 

definitions are not coherent as applied 

to network contracting activities, 

development of reimbursement 

methodologies, or most other network 

composition NQTLs. This commenter 

claimed that there is no algorithmic 

approach to decision making that can be 

documented and requested the 

Departments to provide guidance on 

how the many activities involved in 

constructing provider networks and 

provider reimbursements across 

different plan types, service settings, 

and reimbursement methodologies 

should be categorized. 

As stated in the preamble to the 

proposed rules, the proposed definitions 

for the terms ‘‘processes,’’ ‘‘strategies,’’ 

‘‘evidentiary standards,’’ and ‘‘factors’’ 

are intended to further clarify how to 

properly apply and distinguish between 

these terms, and to help facilitate proper 

comparisons between the design and 

application of NQTLs to medical/ 

surgical benefits and mental health and 

substance use disorder benefits in the 

same classification, compliance with the 

requirements related to NQTLs, and the 

development of sufficient comparative 

analyses, as required under the CAA, 

2021 and these final rules. The 

definitions in these final rules improve 

clarity and add specificity to the terms 

used in MHPAEA, as amended by the 

CAA, 2021, to reduce 

misinterpretations, and are consistent 

with the requirements in these final 

rules that set forth the manner in which 

plans and issuers are required to 

perform and document comparative 

analyses, discussed later in this 

preamble. The Departments also provide 

additional guidance on how plans and 

issuers must comply with the provisions 

of these final rules with respect to 

NQTLs related to network 

composition,59 later in this preamble. 

The Departments note that nothing in 

these final rules requires an 

‘‘algorithmic’’ decision making process; 

however, plans and issuers must 

perform and document their 

comparative analyses as required under 

26 CFR 54.9812–2, 29 CFR 2590.712–1, 

and 45 CFR 146.137 to show that the 

processes, strategies, evidentiary 

standards, and other factors used in 

designing or applying an NQTL to 

mental health and substance use 


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60The preamble to the proposed rules noted that, 

for example, Code section 9812(a)(8)(A)(iii), ERISA 

section 712(a)(8)(A)(iii), and PHS Act section 

2726(a)(8)(A)(iii) refer to the evidentiary standards 

that are used for the factors to determine that an 

NQTL will apply to benefits, and those provisions 

go on to distinguish between factors and any other 

sources or evidence relied upon to design or apply 

an NQTL. See 88 FR 51552, 51567 (Aug. 3, 2023). 

61See FAQs About Affordable Care Act 

Implementation Part 31, Mental Health Parity 

Implementation, and Women’s Health and Cancer 

Rights Act Implementation, Q9 (Apr. 20, 2016), 

https://www.dol.gov/sites/dolgov/files/EBSA/aboutebsa/our-activities/resource-center/faqs/aca-part31.pdf and https://www.hhs.gov/guidance/ 

document/affordable-care-act-implementation-faqsset-31, which states that a plan must provide 

documents and plan information to a participant or 

beneficiary, or their authorized representative, 

including the specific underlying processes, 

strategies, evidentiary standards, and other factors 

(including, but not limited to, all evidence) 

considered by the plan (including factors that were 

relied upon and were rejected) in determining that 

the NQTL will apply to a particular mental health 

and substance use disorder benefit or any medical/ 

surgical benefits within the benefit classification at 

issue. 

disorder benefits, as written and in 

operation, are comparable to, and are 

applied no more stringently than, the 

processes, strategies, evidentiary 

standards, and other factors used in 

designing or applying the NQTL to 

medical/surgical benefits in the relevant 

classification. Additionally, anything 

used by a plan or issuer to design or 

apply an NQTL should be considered a 

process, strategy, evidentiary standard, 

or factor (or information, evidence, 

sources, or standards on which a factor 

or evidentiary standard is based), 

consistent with the Departments’ broad 

interpretation of these terms. 

Under the proposed rules, the 

Departments proposed that evidentiary 

standards generally would not be 

considered factors, but instead would be 

considered or relied upon in designing 

or applying a factor. The Departments 

noted that, although the framework 

established in the 2013 final regulations 

treated the terms within the phrase 

‘‘processes, strategies, evidentiary 

standards, and other factors’’ as having 

overlapping meanings (and the term 

‘‘other factors’’ was utilized as a catchall), the CAA, 2021 added to MHPAEA 

other references to factors and 

evidentiary standards that indicate 

Congress meant to distinguish between 

them.60 The Departments requested 

comments on this approach to defining 

evidentiary standards separately from 

factors, including whether there are any 

circumstances under which an 

evidentiary standard should also be 

considered a factor under the framework 

outlined in the proposed rules, but did 

not receive any specific comments on 

this issue. Therefore, under these final 

rules, consistent with the proposed 

rules, evidentiary standards are not 

considered to be factors. 

The proposed rules provided that the 

term ‘‘evidentiary standards’’ would 

mean any evidence, sources, or 

standards that a plan or issuer 

considered or relied upon in designing 

or applying a factor with respect to an 

NQTL, including specific benchmarks 

or thresholds. The proposed definition 

further provides that evidentiary 

standards may be empirical, statistical, 

or clinical in nature, and include 

sources acquired or originating from an 

objective third party, such as recognized 

medical literature, professional 

standards and protocols (which may 

include comparative effectiveness 

studies and clinical trials), published 

research studies, payment rates for 

items and services (such as publicly 

available databases of the ‘‘usual, 

customary, and reasonable’’ rates paid 

for items and services), and clinical 

treatment guidelines. The proposed 

definition also provides that evidentiary 

standards would include internal plan 

or issuer data, such as claims or 

utilization data or criteria for assuring a 

sufficient mix and number of network 

providers, and benchmarks or 

thresholds, such as measures of 

excessive utilization, cost levels, time or 

distance standards, or network 

participation percentage thresholds. 

One commenter recommended not 

including specific benchmarks or 

thresholds and professional standards 

and protocols in the definition of the 

term ‘‘evidentiary standards.’’ The 

commenter noted that many plans and 

issuers do not define their evidentiary 

standards numerically and that 

finalizing the definition as proposed 

could require plans and issuers to do so, 

thereby compelling plans and issuers 

not to use relevant, critical data in the 

development of their NQTLs. The 

commenter also remarked that including 

professional standards and protocols in 

the definition would require plans and 

issuers to incorporate potentially 

unproven medical guidance as a 

standard to dictate mental health or 

substance use disorder benefits, which 

could override common medical 

management practices. The commenter 

added that, if the reference to 

professional standards and protocols is 

retained, the Departments should clarify 

that the definition of ‘‘evidentiary 

standards’’ does not imply that all 

professional standards and protocols 

must be referenced or that benchmarks 

or thresholds are required to be applied 

to professional standards and protocols. 

The Departments are finalizing the 

definition of ‘‘evidentiary standards’’ as 

proposed. The definition is consistent 

with the use of the term by Congress in 

the amendments made to MHPAEA by 

the CAA, 2021. The definition of the 

term ‘‘evidentiary standards’’ does not 

require plans and issuers to define their 

evidentiary standards numerically, nor 

does it imply that all professional 

standards and protocols must be 

referenced or that benchmarks or 

thresholds are required to be applied to 

professional standards and protocols 

(for example, where the standards are 

qualitative in nature). However, to the 

extent these types of evidentiary 

standards are used to design or apply an 

NQTL, they must be analyzed for 

compliance with MHPAEA. The list of 

examples of evidentiary standards 

included in the definition is not 

intended to be exhaustive, nor are any 

of the evidentiary standards listed 

required to be considered or relied upon 

in designing or applying a factor with 

respect to an NQTL. 

In the proposed rules, the 

Departments proposed that the 

definition of the term ‘‘factors’’ be read 

broadly, so that factors are all 

information, including processes and 

strategies (but not evidentiary 

standards), that a plan or issuer 

considered or relied upon to design an 

NQTL or to determine whether or how 

the NQTL applies to benefits under the 

plan or coverage. The Departments 

noted that by defining the term ‘‘factor’’ 

broadly, the Departments’ intention was 

to capture any information used to 

design or apply an NQTL (other than 

evidentiary standards), regardless of 

whether a plan or issuer believes that 

information could also be characterized 

as a ‘‘process’’ or a ‘‘strategy,’’ as those 

terms were proposed to be defined. The 

Departments proposed that the term 

‘‘factors’’ includes information (but not 

evidentiary standards) that the plan or 

issuer considered but rejected, 

consistent with previous guidance on 

MHPAEA in the context of the 

documents or plan information the 

Departments consider relevant to a 

compliance determination.61 The 

proposed definition also provided 

examples of factors, which include, but 

are not limited to, provider discretion in 

determining diagnosis or type or length 

of treatment; clinical efficacy of any 

proposed treatment or service; licensing 

and accreditation of providers; claim 

types with a high percentage of fraud; 

quality measures; treatment outcomes; 

severity or chronicity of condition; 

variability in the cost of an episode of 

treatment; high cost growth; variability 

in cost and quality; elasticity of 

demand; and geographic location. 


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62The Departments are also finalizing a nonsubstantive modification so that the definition more 

closely parallels the definition of ‘‘strategies.’’ 

63For example, these final rules clarify that 

provider referral requirements are processes if they 

are used to determine when and how a participant 

or beneficiary may access certain services. 

Similarly, the development and approval of a 

treatment plan are processes if they are used in a 

concurrent review process to determine whether a 

specific request should be granted or denied. 

With respect to the ‘‘broad’’ reading of 

the term ‘‘factor,’’ a commenter stated 

that the proposed definition subsumes 

‘‘processes’’ and ‘‘strategies,’’ and 

suggested eliminating or clarifying this 

distinction with additional guidance. 

The commenter also remarked that the 

broad definition of ‘‘factor’’ would make 

the multiple steps in a comparative 

analysis less distinguishable, and the 

requirement that plans identify, define, 

and describe the use of every factor in 

the design or application of an NQTL 

unworkably expansive. A few 

commenters remarked that the breadth 

of the definition of ‘‘factor’’ makes it 

unclear how a plan or issuer would 

demonstrate that a factor is unbiased or 

not discriminatory for the purposes of 

the comparative analyses and 

recommended narrowing the definition 

of ‘‘factor’’ to distinguish it from 

evidentiary standards, processes, and 

strategies, and instead use the term to 

describe the basis for the plan’s or 

issuer’s application of an NQTL. 

Another commenter recommended not 

including information that the plan or 

issuer considered but rejected in the 

definition of factors, because it is not 

illustrative of the ultimate value of the 

mental health or substance use disorder 

benefit or the plan’s or issuer’s 

compliance with MHPAEA’s NQTL 

standards. The commenter stated that 

the actual design of the benefit and how 

it translates to payments, denials, and 

reimbursement should substantiate 

whether the benefit design complies 

with parity requirements, without 

examining extraneous information on 

considerations early in the benefit’s 

development process. A commenter 

suggested the Departments include an 

example of what the Departments would 

consider a complete definition of a 

factor and information about how to 

specify the weight assigned to factors. 

The Departments are finalizing the 

definition of the term ‘‘factor’’ as 

proposed. The definition and list of 

examples of factors in the definition 

contained in these final rules are 

sufficiently detailed to provide context 

to plans and issuers in identifying 

factors, including by distinguishing 

evidentiary standards from factors and 

acknowledging that factors other than 

processes and strategies, which are 

types of factors, may exist. Under the 

2013 final regulations, plans and issuers 

were permitted to utilize a wide array of 

factors in designing and applying their 

NQTLs to mental health and substance 

use disorder benefits provided they 

were comparable to, and applied no 

more stringently than, those utilized to 

design and apply NQTLs to medical/ 

surgical benefits. Similarly, the CAA, 

2021 did not limit what factors plans 

and issuers could use to design and 

apply their NQTLs, but instead required 

that these factors be identified and 

analyzed in the comparative analyses. 

As noted in the preamble to the 

proposed rules, taking into account not 

only the factors that the plan or issuer 

relied upon, but also those that were 

considered but ultimately rejected in the 

definition of factors, is consistent with 

previous guidance on MHPAEA, namely 

because it is a factor that a plan or issuer 

uses in designing and applying an 

NQTL. The Departments recognize that 

the language used in the proposed rules, 

which included factors that were 

considered and rejected, rather than 

those that are relied upon and rejected, 

could be interpreted as including a 

broader set of information than prior 

guidance, which had interpreted 

‘‘considered’’ to include ‘‘factors that 

were relied upon and were rejected.’’ 

The Departments did not intend to 

broaden the set of information included 

as a factor, and agree with the 

commenter who questioned the utility 

of providing information that was 

considered early in the design process 

but rejected. However, the Departments 

affirm that taking into account 

information that the plan or issuer 

relied upon and rejected in the 

definition of factors is necessary to 

analyze compliance with MHPAEA. 

In the proposed rules, the 

Departments proposed to define 

‘‘processes’’ and ‘‘strategies’’ as types of 

factors, and to clarify the differences 

between the two terms as they relate to 

the design and application of an NQTL. 

Specifically, the Departments proposed 

defining ‘‘processes’’ as relating to the 

application of an NQTL, while 

‘‘strategies’’ would relate to the design 

of an NQTL. After review of the 

comments, the Departments continue to 

be of the view that the best read of the 

statutory text (as well as the 2013 final 

regulations) is that processes and 

strategies are types of factors, rather 

than components of a factor to be 

separately evaluated. 

The Departments proposed to define 

‘‘processes’’ to mean actions, steps, or 

procedures that a plan or issuer uses to 

apply an NQTL, including actions, steps 

or procedures established by the plan or 

issuer as requirements in order for a 

participant or beneficiary to access 

benefits, including through actions by a 

participant’s or beneficiary’s authorized 

representative or a provider or facility. 

Under the proposed rules, processes 

include, but are not limited to: prior 

authorization procedures, provider 

referral requirements, and the 

development and approval of a 

treatment plan. The proposed definition 

also provided that processes include the 

specific procedures used by staff or 

other representatives of a plan or issuer 

(or the service provider of a plan or 

issuer) to administer the application of 

NQTLs, such as how a panel of staff 

members applies the NQTL (including 

the qualifications of staff involved, 

number of staff members allocated, and 

time allocated), consultations with 

panels of experts in applying the NQTL, 

and reviewer discretion in adhering to 

criteria hierarchy when applying an 

NQTL. 

A commenter expressed appreciation 

for the proposed rules’ intent and 

requested the Departments to include 

more specific examples of ‘‘processes.’’ 

Another commenter stated that the 

proposed definition for ‘‘processes’’ is 

too broad and focuses only on the end 

result of access to benefits, which the 

commenter stated is inconsistent with 

the Departments’ previous guidance and 

regulations, and recommended 

narrowing the definition to focus on the 

operational application of any 

requirements. 

After reviewing comments, the 

Departments are finalizing the 

definition of the term ‘‘processes,’’ with 

minor changes so that the examples of 

processes more clearly illustrate the way 

the action, step, or procedure is used to 

apply an NQTL.62 While the 

Departments decline to add examples to 

the definition, these modifications will 

add clarity to the definition in these 

final rules.63 The Departments note that 

the final definition of the term does not 

focus only on the end result of access to 

benefits, but also includes the 

operational application of an NQTL, as 

evidenced by the framing of the 

definition in terms of actions, steps, or 

procedures used to apply an NQTL. For 

example, prior authorization processes 

include the procedures established by a 

plan or issuer for a review to determine 

how a specific request for prior 

authorization should be granted or 

denied. Concurrent review processes 

include the procedures established by a 

plan or issuer for a review to determine 

whether a specific request should be 


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64The content elements of comparative analyses 

are addressed later in this preamble. 

65The proposed rules referred to fraud, waste, 

and abuse. However, as explained later in this 

preamble, the Departments agree with commenters 

that the term ‘‘waste’’ can be construed in a manner 

that is overly broad. Thus, in these final rules, when 

discussing the exception in the proposed rules for 

NQTLs that are narrowly and reasonably designed 

to detect or prevent and prove fraud, waste, and 

abuse, while minimizing the impact on access to 

appropriate mental health and substance use 

disorder benefits, this preamble refers to ‘‘fraud, 

waste, and abuse measures.’’ When discussing 

provisions of this final rule related to carefully 

circumscribed measures reasonably and 

appropriately designed to detect or prevent and 

prove fraud and abuse, this preamble refers to 

‘‘fraud and abuse measures.’’ 

granted or denied, such as when peerto-peer review is required. 

The proposed rules proposed to 

define ‘‘strategies’’ as practices, 

methods, or internal metrics that a plan 

or issuer considers, reviews, or uses to 

design an NQTL, and included 

examples of strategies. The proposed 

definition of strategies included the 

following examples: the development of 

the clinical rationale used in approving 

or denying benefits; deviation from 

generally accepted standards of care; the 

selection of information (such as from 

medical or clinical guidelines) deemed 

reasonably necessary to make a medical 

necessity determination; reliance on 

treatment guidelines or guidelines 

provided by third-party organizations; 

and rationales used in selecting and 

adopting certain threshold amounts, 

professional protocols, and fee 

schedules. The proposed definition of 

strategies also specifically included: the 

creation and composition of the staff or 

other representatives of a plan or issuer 

(or the service provider of a plan or 

issuer) that deliberates, or otherwise 

makes decisions, on the design of 

NQTLs, including the plan’s or issuer’s 

decisions related to qualifications of 

staff involved; number of staff members 

allocated, and time allocated; breadth of 

sources and evidence considered; 

consultations with panels of experts in 

designing the NQTL; and the 

composition of the panels used to 

design an NQTL. 

One commenter supported the 

inclusion in the definition of 

‘‘strategies’’ of practices that involve 

‘‘deviations from generally accepted 

standards of care.’’ Several commenters 

also recommended that the Departments 

include actions to detect or prevent and 

prove fraud, waste, and abuse in the 

definitions of either or both ‘‘processes’’ 

and ‘‘strategies,’’ rather than including 

those actions as a stand-alone exception 

from the NQTL requirements in the final 

rules. Another commenter appreciated 

the clear distinction made in the 

proposed definitions of processes and 

strategies and stated that they would 

appreciate if these distinctions tracked 

with separate steps in the comparative 

analyses.64

The Departments are generally 

finalizing the definition of the term 

‘‘strategies’’ with some minor changes to 

the examples to add specificity. The 

definition of the term ‘‘strategies’’ in 

these final rules includes examples of 

strategies used to design an NQTL, such 

as the method of determining whether 

and how to deviate from generally 

accepted standards of care in concurrent 

reviews; rationales used in selecting and 

adopting certain threshold amounts to 

apply an NQTL; professional standards 

and protocols to determine utilization 

management standards; and fee 

schedules used to determine provider 

reimbursement rates, used as part of an 

NQTL. The Departments note that, once 

a plan or issuer uses a strategy to design 

an NQTL, that design also may result in 

the establishment or use of processes to 

apply the NQTL. 

While the Departments acknowledge 

comments suggesting that actions to 

detect or prevent and prove fraud, 

waste, and abuse be defined as either 

‘‘processes’’ or ‘‘strategies,’’ and 

acknowledge that such actions certainly 

could constitute either processes or 

strategies (depending on whether the 

action is undertaken to design or apply 

the NQTL), the Departments decline to 

add a specific reference to actions to 

detect or prevent and prove fraud, 

waste, and abuse to the relevant 

definitions, as the proposed exception 

for standards to detect or prevent and 

prove fraud, waste, and abuse is not 

being finalized, as discussed later in this 

preamble.65 However, the Departments 

are providing additional language to 

explain what constitutes a standard to 

detect or prevent and prove fraud and 

abuse (also referred to as ‘‘fraud and 

abuse measures’’) later in this preamble 

and how such standards must comply 

with MHPAEA under these final rules. 

c. Treatment Limitations 

The Departments proposed to amend 

the definition of ‘‘treatment limitations’’ 

to clarify that the illustrative list of 

NQTLs to which the definition refers is 

non-exhaustive and to amend the last 

sentence to state that a ‘‘complete’’ 

(rather than ‘‘permanent’’) exclusion of 

all benefits for a particular condition or 

disorder is not a treatment limitation for 

purposes of the definition. In the 

preamble to the proposed rules, the 

Departments noted that, while NQTLs 

are generally defined as treatment 

limitations that are not expressed 

numerically, the application of an 

NQTL in a numerical way does not 

modify its nonquantitative character 

simply because the NQTL sometimes 

involves numerical standards, and such 

NQTLs would still be evaluated in 

accordance with the rules for NQTLs 

under the statute and implementing 

regulations. 

Several commenters supported the 

Departments’ amendment to the 

definition of ‘‘treatment limitation’’ to 

specify that ‘‘a complete exclusion of all 

benefits for a particular condition or 

disorder is not a treatment limitation for 

purposes of this definition,’’ rather than 

retaining the reference in the 2013 final 

regulations to a ‘‘permanent’’ exclusion. 

These commenters stated that the 

proposed definition more clearly 

specifies that a plan or issuer can 

exclude a particular condition or service 

without creating an NQTL, but that in 

doing so, the exclusion must be total. 

The commenters suggested the 

Departments include specific examples 

of permissible exclusions and 

impermissible exclusionary language. 

Other commenters expressed concern 

that the proposed definition of 

‘‘treatment limitation’’ is too broad and 

argued that the proposed definition 

would lead to increased uncertainty in 

determining which common plan 

practices could constitute an NQTL. 

One commenter stated that if there is no 

comparable medical or surgical 

treatment limitation, there is nothing to 

compare a treatment limitation on a 

mental health or substance use disorder 

benefit to, and that therefore such a 

limitation on the mental health or 

substance use disorder benefit is not 

subject to parity requirements. Several 

commenters recommended adopting a 

consistent and exhaustive definition for 

determining whether a medical 

management technique is a treatment 

limitation. 

The Departments are finalizing the 

definition of ‘‘treatment limitation’’ as 

proposed, with minor modifications to 

add an example of an NQTL. As 

reflected in the definition, medical 

management techniques are NQTLs if 

they limit the scope or duration of 

treatment. While the definition as 

amended is broad, plans and issuers 

have great latitude in the types of 

limitations that they may impose, and 

the Departments understand that plans 

and issuers do in fact impose a broad 

range of limitations on the scope or 

duration of treatment. In enacting 

MHPAEA and the amendments to 

MHPAEA contained in the CAA, 2021, 

Congress did not prohibit the use of 

these limitations for mental health and 

substance use disorder benefits, but 


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66See 75 FR 5410, 5413 (Feb. 2, 2010). 

required that plans and issuers ensure 

that NQTLs satisfy the statutory 

requirements that (1) any treatment 

limitations imposed on mental health 

and substance use disorder benefits are 

no more restrictive than the 

predominant treatment limitations 

imposed on substantially all medical/ 

surgical benefits; (2) that no treatment 

limitations be imposed only with 

respect to mental health and substance 

use disorder benefits; and (3) that plans 

and issuers perform and document 

comparative analyses of the design and 

application of NQTLs. Because of the 

broad range of treatment limitations that 

plans and issuers may impose, 

combined with the freedom that plans 

and issuers have to design their own 

unique limitations, the Departments 

cannot provide a comprehensive and 

exhaustive list of all limitations, as 

further explained later in this preamble. 

The Departments note that if a plan or 

issuer applies a treatment limitation to 

mental health and substance use 

disorder benefits where medical/ 

surgical benefits are not subject to a 

comparable treatment limitation in the 

same classification, the plan or issuer 

would violate MHPAEA because it must 

not apply separate treatment limitations 

only to mental health and substance use 

disorder benefits. Further, the 

Departments have stated that, if a plan 

or issuer provides any benefits for a 

mental health condition or substance 

use disorder but excludes benefits for 

items or services for that condition or 

disorder in a classification in which it 

provides medical/surgical benefits, such 

an exclusion of a benefit for a condition 

or disorder that is otherwise covered is 

a treatment limitation because it is a 

limit on the scope or duration of 

treatment offered.66 While the 

Departments decline to provide 

additional examples of permissible 

exclusions and impermissible 

exclusionary language in these final 

rules, examples of such exclusions and 

language have been provided in 

guidance and in the Departments’ 

reports to Congress. 

3. Nonquantitative Treatment 

Limitations—26 CFR 54.9812–1(c)(4), 29 

CFR 2590.712(c)(4), and 45 CFR 

146.136(c)(4) 

In the proposed rules, the 

Departments proposed changes 

designed to better ensure that plans and 

issuers do not design and implement 

NQTLs that impose greater restrictions 

on access to mental health and 

substance use disorder benefits as 

compared to medical/surgical benefits. 

The Departments proposed to add 

requirements that apply to NQTLs with 

respect to mental health and substance 

use disorder benefits, to ensure that 

plans and issuers do not impose a 

greater burden on participants and 

beneficiaries accessing those benefits 

than the burden imposed on 

participants and beneficiaries accessing 

medical/surgical benefits, while 

preserving the ability of plans and 

issuers to impose NQTLs to the extent 

they are consistent with generally 

recognized independent professional 

medical or clinical standards or 

legitimate and narrowly designed 

standards related to fraud, waste, and 

abuse. Subject to those two narrow 

exceptions for those types of NQTLs, the 

proposed rules provided that plans and 

issuers would not be permitted to 

impose an NQTL on mental health or 

substance use disorder benefits unless 

they satisfied all of the following three 

requirements: (1) the NQTL is no more 

restrictive as applied to mental health 

and substance use disorder benefits than 

to medical/surgical benefits (also 

referred to as the no more restrictive 

requirement); (2) the plan or issuer 

satisfies requirements related to the 

design and application of the NQTL 

(also referred to as the design and 

application requirements); and (3) the 

plan or issuer collects, evaluates, and 

considers the impact of relevant data on 

access to mental health and substance 

use disorder benefits relative to access 

to medical/surgical benefits; and 

subsequently takes reasonable action, as 

necessary, to address any material 

differences in access shown in the data 

to ensure compliance with MHPAEA 

(also referred to as the relevant data 

evaluation requirements). 

Specifically, under the no more 

restrictive requirement, the proposed 

rules specified that a plan or issuer may 

not apply any NQTL to mental health or 

substance use disorder benefits in any 

classification that is more restrictive, as 

written or in operation, than the 

predominant NQTL that applies to 

substantially all medical/surgical 

benefits in the same classification. This 

requirement was intended to ensure that 

the implementing regulations more 

closely mirrored the statutory language 

in Code section 9812(a)(3)(A), ERISA 

section 712(a)(3)(A), and PHS Act 

section 2726(a)(3)(A). 

The proposed rules outlined a fourprong test for a plan or issuer to 

determine compliance with the no more 

restrictive requirement. Specifically, 

this provision would have required 

plans and issuers to determine: (1) the 

portion of plan payments for medical/ 

surgical benefits subject to an NQTL in 

a classification; (2) whether the NQTL 

applies to substantially all medical/ 

surgical benefits in the classification; (3) 

if the NQTL applies to substantially all 

medical/surgical benefits in the 

classification, the predominant variation 

of the NQTL that applies to 

substantially all medical/surgical 

benefits in the classification; and (4) 

whether the NQTL, as applied to mental 

health and substance use disorder 

benefits in the classification, is more 

restrictive than the predominant 

variation of the NQTL as applied to 

substantially all medical/surgical 

benefits. 

The second proposed requirement for 

NQTLs, the design and application 

requirements, retained the requirements 

for NQTLs from the 2013 final 

regulations focused on the processes, 

strategies, evidentiary standards, and 

other factors used to apply an NQTL, 

with a proposed modification to better 

align the rules with the statute’s focus 

on the design of an NQTL in addition 

to its application. In addition, the 

Departments proposed to prohibit plans 

and issuers from relying upon any factor 

or evidentiary standard if the 

information, evidence, sources, or 

standards on which the factor or 

evidentiary standard was based 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits. 

The third requirement for NQTLs 

under the proposed rules, the relevant 

data evaluation requirements, proposed 

to require plans and issuers to collect 

and evaluate relevant outcomes data 

and take reasonable action to address 

material differences in access between 

mental health and substance use 

disorder benefits and medical/surgical 

benefits as necessary to ensure 

compliance, in operation, with 

MHPAEA. This requirement also 

included a proposed special rule for 

NQTLs related to network composition. 

The proposed rules stated that, if a 

plan or issuer fails to meet any of the 

three requirements under the proposed 

rules with respect to an NQTL in a 

classification, the NQTL would violate 

MHPAEA and, as a result, could not be 

imposed on mental health or substance 

use disorder benefits in the 

classification without changes to the 

terms of the plan or coverage, or the way 

the NQTL is designed or applied, to 

ensure compliance with MHPAEA. 

The Departments proposed two 

limited exceptions to some of the 

requirements for NQTLs, consistent 

with the Departments’ intention to 

avoid interference with a plan’s or 

issuer’s attempts to ensure that NQTLs 

imposed with respect to benefits for 


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67Code section 9812(a)(3)(A), ERISA section 

712(a)(3)(A), and PHS Act section 2726(a)(3)(A). 

treatment of mental health conditions or 

substance use disorders are consistent 

with generally accepted independent 

professional medical or clinical 

standards of care (also referred to as 

independent professional medical or 

clinical standards) or are narrowly and 

reasonably designed to detect or prevent 

and prove fraud, waste, and abuse, 

while minimizing the impact on access 

to appropriate mental health and 

substance use disorder benefits (also 

referred to as fraud, waste, and abuse 

measures). The Departments proposed 

to exempt NQTLs qualifying for the 

exception for independent professional 

medical or clinical standards from 

compliance with the no more restrictive 

requirement, the prohibition on 

discriminatory factors and evidentiary 

standards, and the relevant data 

evaluation requirements. The 

Departments proposed to exempt 

NQTLs qualifying for the exception for 

fraud, waste, and abuse measures from 

compliance with the no more restrictive 

requirement and the prohibition on 

discriminatory factors and evidentiary 

standards, but not the relevant data 

evaluation requirements. 

Finally, the Departments proposed to 

make clear that a plan or issuer that has 

received a final determination of 

noncompliance under the comparative 

analysis review process established by 

the CAA, 2021, including a final 

determination of noncompliance based 

on failure to provide a sufficient 

comparative analysis, would also be in 

violation of the substantive 

requirements that apply to NQTLs 

under MHPAEA, as determined by the 

Departments. Upon such a 

determination, the proposed rules 

would permit the Departments to direct 

the plan or issuer to not impose the 

NQTL that is the subject of the 

comparative analysis, unless and until 

the plan or issuer can demonstrate 

compliance or take appropriate action to 

remedy the violation. 

The Departments requested comments 

on all aspects of these proposed 

amendments, including the exceptions 

to the proposed rules regarding NQTLs. 

Many commenters expressed support 

for these provisions of the proposed 

rules as a whole, as a means of 

achieving increased access to mental 

health and substance use disorder 

benefits by targeting NQTLs that 

otherwise impede access. Other 

commenters expressed support for the 

proposed rules’ enhanced specificity 

with respect to the requirements for 

imposing NQTLs, with one commenter 

also indicating that the proposals would 

help State insurance regulators better 

enforce MHPAEA and clarify plans’ and 

issuers’ compliance obligations. 

However, other commenters 

expressed the view that these provisions 

of the proposed rules were complex, 

ambiguous, confusing, subject to 

interpretation, or difficult to 

operationalize, which they argued could 

lead to substantial uncertainty for plans 

and issuers attempting to comply. 

Commenters also stated that it may be 

impossible for plans or issuers to meet 

the proposed mathematical substantially 

all and predominant tests as applied to 

NQTLs, leading them to eliminate 

necessary utilization management tools. 

Some commenters also indicated that 

these provisions of the proposed rules 

could lead to inconsistent application of 

NQTLs across plans administered by the 

same TPA or issuer, which could result 

in administrative complexity and cause 

confusion for consumers and providers. 

Other commenters highlighted that the 

proposed requirements would 

significantly increase the cost of 

administering plans and health 

insurance coverage. One commenter 

indicated that some plans might 

consider excluding all treatments or 

services for a particular mental health 

condition or substance use disorder as 

a result of the additional burdens 

imposed by the substantially all and 

predominant tests, if finalized as 

proposed. Some commenters also stated 

that the additional proposed 

requirements for NQTLs do not add 

value beyond distinctions already 

captured by the design and application 

requirements included in the 2013 final 

regulations, with some commenters 

stating those additional requirements go 

beyond MHPAEA’s statutory 

requirements. Comments specific to 

each of the three requirements and two 

exceptions proposed at 26 CFR 54.9812– 

1(c)(4)(i), (ii), and (iv); 29 CFR 

2590.712(c)(4)(i), (ii), and (iv); and 45 

CFR 146.136(c)(4)(i), (ii), and (iv) are 

discussed in greater detail later in this 

preamble. 

The Departments acknowledge the 

concerns expressed by commenters and, 

in response to comments, the 

Departments are finalizing a modified 

framework that is still intended to 

prevent plans and issuers from 

designing and applying NQTLs that 

impose greater burdens on access to 

mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits, while limiting 

uncertainty, increases in cost, 

operational difficulty, and unintended 

consequences. These final rules 

streamline the proposed rules’ general 

requirements to eliminate redundancies 

and add clarity for plans and issuers in 

a manner that remains consistent with 

the statutory text of MHPAEA, while 

also ensuring participants and 

beneficiaries will not face greater 

restrictions on access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

These final rules do not finalize the 

language of the proposed ‘‘no more 

restrictive’’ requirement, as discussed in 

more detail later in this preamble, and 

instead incorporate the statutory 

requirements of Code section 

9812(a)(3)(A), ERISA section 

712(a)(3)(A), and PHS Act section 

2726(a)(3)(A) as the overall general rule 

for NQTLs in 26 CFR 54.9812–1(c)(4), 

29 CFR 2590.712(c)(4), and 45 CFR 

146.136(c)(4). Specifically, these final 

rules state that, consistent with the 

fundamental purpose of MHPAEA, a 

group health plan (or health insurance 

coverage offered by an issuer in 

connection with a group health plan) 

may not impose any NQTL with respect 

to mental health or substance use 

disorder benefits in any classification 

that is more restrictive, as written or in 

operation, than the predominant NQTL 

that applies to substantially all medical/ 

surgical benefits in the same 

classification. However, as discussed 

later in this preamble, the Departments 

are declining to finalize the proposed 

four-prong test for the no more 

restrictive requirement, which was 

proposed to determine compliance with 

statutory requirements as they apply to 

NQTLs.67 Rather, to demonstrate 

compliance with the no more restrictive 

requirement, which is now the general 

rule for NQTLs, a plan or issuer is 

required under these final rules to 

satisfy (1) the design and application 

requirements and (2) the relevant data 

evaluation requirements, each of which 

the Departments are finalizing with 

modifications, as discussed in more 

detail later in this preamble. 

Additionally, the Departments are not 

finalizing the exceptions set forth in the 

proposed rules, but have added 

language to these final rules to explain 

how plans and issuers should analyze 

and account for independent 

professional medical or clinical 

standards and fraud and abuse measures 

in designing and applying their NQTLs. 

Finally, the Departments are finalizing a 

provision providing that, depending on 

the relevant facts and circumstances, the 

Departments or an applicable State 

authority may direct a plan or issuer 

that has received a final determination 

of noncompliance under the 

comparative analysis review process 


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77600 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

established by the CAA, 2021 to not 

apply an impermissible NQTL. 

a. Requirement That NQTLs Be No More 

Restrictive for Mental Health Benefits 

and Substance Use Disorder Benefits— 

26 CFR 54.9812–1(c)(4), 29 CFR 

2590.712(c)(4), and 45 CFR 

146.136(c)(4) 

Through the proposed mathematical 

substantially all and predominant tests 

for NQTLs as part of the no more 

restrictive requirement, the Departments 

proposed to require plans and issuers to 

follow similar steps to those that apply 

when analyzing parity with respect to 

financial requirements or quantitative 

treatment limitations under the 2013 

final regulations (referred to in this 

preamble as the proposed mathematical 

substantially all and predominant tests). 

As noted in the proposed rules, the 

steps in the proposed mathematical 

substantially all and predominant tests 

would have involved determining the 

portion of plan payments for medical/ 

surgical benefits subject to an NQTL in 

a classification; whether the NQTL 

applies to substantially all medical/ 

surgical benefits in the classification; if 

the NQTL applies to substantially all 

medical/surgical benefits in the 

classification, the predominant variation 

of the NQTL that applies to 

substantially all medical/surgical 

benefits in the classification; and 

whether the NQTL, as applied to mental 

health and substance use disorder 

benefits in the classification, is more 

restrictive than the predominant 

variation of the NQTL, as applied to 

substantially all medical/surgical 

benefits. 

Many commenters generally 

supported application of the proposed 

mathematical substantially all and 

predominant tests to NQTLs, with some 

indicating that the tests would provide 

additional clarity, eliminate 

subjectivity, assist regulators, and result 

in compliance improvements. Many of 

these commenters also stated that the 

statute clearly supports the tests, as it 

requires treatment limitations to be ‘‘no 

more restrictive’’ than the predominant 

treatment limitations that apply to 

substantially all medical/surgical 

benefits. Other commenters generally 

opposed the inclusion of the 

substantially all and predominant tests 

for NQTLs as part of the no more 

restrictive requirement. Some of these 

commenters stated that the proposed 

mathematical substantially all and 

predominant tests are a reversal of 

policy from the 2013 final regulations 

and are inconsistent with congressional 

intent, because Congress codified the 

design and application requirements 

from the 2013 final regulations in the 

CAA, 2021. These commenters 

highlighted that the Departments had 

stated previously that they understood 

NQTLs could not be easily quantified 

and that the Departments had not 

sufficiently explained their change in 

interpretation under the proposed rules. 

Some commenters expressed general 

concerns that NQTLs are inherently 

unquantifiable, arguing that the 

proposal would result in unworkable 

standards or arbitrary outcomes that 

could prohibit plans and issuers from 

using evidence-based medical 

guidelines or other relevant factors 

specific to the item or service under 

consideration. Commenters also raised 

concerns that imposition of the 

proposed mathematical substantially all 

and predominant tests on certain types 

of NQTLs that are not commonly 

utilized for medical/surgical benefits 

may lead to some types of legitimate 

NQTLs no longer being permitted with 

respect to mental health and substance 

use disorder benefits. Specifically, 

several of these commenters contended 

that the proposed mathematical 

substantially all and predominant tests, 

as proposed, would result in the 

elimination of plans’ and issuers’ ability 

to impose certain NQTLs with respect to 

mental health and substance use 

disorder benefits, such as step therapy, 

prior authorization, and concurrent 

review, which they posited would 

negatively impact the quality and cost of 

care. Some commenters also cited 

potential negative, unintended 

consequences of the application of the 

proposed mathematical substantially all 

and predominant tests, as proposed, 

including patient safety concerns; 

impacts on health outcomes, quality, 

and affordability; and a chilling effect 

on access improvements and 

innovation. Further, some commenters 

expressed concern with the increased 

costs associated with complying with 

the proposed mathematical substantially 

all and predominant tests, with some 

stating that this increased burden would 

not be offset by any resulting increase in 

access to mental health and substance 

use disorder benefits for participants 

and beneficiaries. 

Several commenters expressed 

confusion as to how these tests, as 

proposed, would be applied in practice 

and highlighted the need for more 

detail. Specifically, some commenters 

stated that these proposed provisions 

lack clarity in how the tests apply to 

certain types of NQTLs (including those 

related to network composition), and 

the potential consequences of 

enforcement of these requirements. 

Many commenters provided specific 

comments and feedback on aspects of 

each part of the substantially all and 

predominant tests included in the 

proposed rules, as discussed later in this 

preamble, and highlighted ambiguities 

and challenges operationalizing the 

proposed quantitative testing 

requirements with respect to NQTLs. 

Under the first prong of the proposed 

mathematical substantially all and 

predominant tests, plans and issuers 

would have been required to determine 

the portion of plan payments for 

medical/surgical benefits in the 

classification expected to be subject to 

the NQTL based on the dollar amount 

of all plan payments for medical/ 

surgical benefits in the classification 

expected to be paid under the plan or 

coverage for the plan year (or the 

portion of the plan year after a change 

in benefits that affects the applicability 

of the NQTL). The proposed rules stated 

that, for purposes of this determination, 

any reasonable method could be used to 

determine the dollar amount expected 

to be paid under a plan for medical/ 

surgical benefits. 

The Departments received many 

comments on the proposed requirement 

that the plan or issuer determine the 

portion of plan payments for medical/ 

surgical benefits expected to be subject 

to an NQTL in the benefit classification. 

Several commenters indicated that the 

determination of the dollar amount of 

all plan payments for medical/surgical 

benefits expected to be paid may be an 

inappropriate measure altogether 

because NQTLs like medical 

management, assessments related to 

medical necessity, experimental/ 

investigational treatment exclusions, 

prior authorization requests, and 

provider network admission standards 

are not generally attached to claims. 

Some commenters highlighted that selfinsured plan sponsors may face 

challenges in obtaining a complete and 

reliable set of plan-level claims data, 

and accordingly, would have limited 

data to use to assess individual NQTLs, 

or would incur additional costs. 

After determining the portion of plan 

payments for medical/surgical benefits 

in the classification expected to be 

subject to the NQTL, the Departments 

proposed that, under the second prong, 

plans and issuers would be required to 

determine whether the NQTL applies to 

substantially all medical/surgical 

benefits in the classification, based on 

the dollar amount of all plan payments 

for medical/surgical benefits in the 

classification expected to be paid under 

the plan for the plan year. Under the 

proposed rules, an NQTL would be 

considered to apply to substantially all 

medical/surgical benefits in a 


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68For example, if a plan or issuer applies a 

general exclusion for all benefits in a classification 

that are for experimental or investigative treatment, 

and defines experimental or investigative treatment 

to be treatments with less than a certain number of 

peer-reviewed studies demonstrating efficacy, 

under the proposed rules, the exclusion would be 

treated as applying to all of the benefits in the 

classification—not just those that may be subject to 

the general exclusion for experimental or 

investigative treatment because they lack the 

requisite number of peer-reviewed studies (that is, 

those that actually triggered the NQTL based on the 

evidentiary standard). 88 FR 51552, 51570 (Aug. 3, 

2023). 

classification if it applies to at least twothirds of all medical/surgical benefits in 

that classification. Under the proposed 

rules, whether the NQTL applies to at 

least two-thirds of all medical/surgical 

benefits would be determined without 

regard to whether the NQTL was 

triggered based on a particular factor or 

evidentiary standard.68 The proposed 

rules further provided that if an NQTL 

does not apply to at least two-thirds of 

all medical/surgical benefits in a 

classification, that NQTL would not be 

permitted to be applied to mental health 

or substance use disorder benefits in 

that classification. 

The Departments received many 

comments regarding this prong of the 

proposed mathematical substantially all 

and predominant tests. As mentioned 

earlier in this preamble, many 

commenters stated that, in practice, a 

numerical ‘‘substantially all’’ 

determination would be difficult to 

apply and assess for NQTLs for many 

reasons, including because they are 

often not quantifiable, and there are 

more medical/surgical items and 

services (and associated benefits) than 

there are mental health and substance 

use disorder items and services. 

Additionally, commenters highlighted 

that plans and issuers already 

experience difficulty in obtaining data 

from service providers and would have 

difficulty in determining which NQTLs 

apply to at least two-thirds of medical/ 

surgical benefits in a classification. 

Some commenters predicted that, if the 

Departments finalize the substantially 

all and predominant tests as proposed, 

plans and issuers might increase the 

application of NQTLs to medical/ 

surgical benefits to meet the two-thirds 

threshold. 

Further, some commenters requested 

that the Departments specify and 

provide examples showing how to apply 

the substantially all test to NQTLs that 

are not associated with plan payments, 

such as prescription drug formularies 

and network composition standards. 

One commenter highlighted that it is 

difficult to calculate the amount of plan 

payments expected to be paid for 

prescription drugs subject to an NQTL. 

Another commenter urged the 

Departments to clarify the 

determination of whether an NQTL 

applies regardless of whether the NQTL 

was triggered. For example, this 

commenter highlighted that insurers 

might state that prior authorization 

‘‘applies’’ to all benefits in a 

classification where a benefit is 

considered or evaluated under the 

various factors for determining whether 

to apply prior authorization, even if the 

benefit ultimately is determined to not 

be subject to prior authorization based 

on the application of factors and 

evidentiary standards. 

In addition, in the proposed rules, the 

Departments solicited comments on 

whether plans and issuers maintain 

systems capable of determining, under 

the proposed mathematical substantially 

all and predominant tests, whether an 

NQTL applies to substantially all 

medical/surgical benefits in a 

classification, and the administrative 

burden that would be associated with 

such determinations. Several 

commenters highlighted that it would 

be difficult to comply with the 

substantially all and predominant tests 

as proposed, including because the 

requisite data may be housed in 

different parts of a plan’s or issuer’s 

organization. One commenter 

emphasized that current administrative 

systems would need to be adapted, and 

plans and issuers would need to hire 

additional staff or service providers to 

be able to perform the analysis that 

would be required under the proposed 

mathematical substantially all and 

predominant tests. 

Under the proposed rules, if a plan or 

issuer determined that an NQTL applies 

to substantially all medical/surgical 

benefits in a classification, the third 

prong of the test would require a plan 

or issuer to determine the predominant 

variation of the NQTL that is applied to 

substantially all medical/surgical 

benefits subject to the NQTL in the 

classification. The Departments 

proposed that the term ‘‘predominant’’ 

would, for this purpose, mean the most 

common or most frequent variation of 

an NQTL within a benefit classification. 

The Departments received many 

comments regarding this part of the 

proposed tests. Numerous commenters 

stated that this aspect of the 

substantially all and predominant tests 

is unworkable. Some commenters noted 

that, with a lack of guidance on how to 

identify all the variations of a particular 

NQTL (especially those that are 

complex and nuanced), the proposed 

rules may not be feasible for plans, 

issuers, and regulators to apply in reallife situations. Several commenters 

stated that, while financial requirements 

and quantitative treatment limitations 

will have only a few different variations, 

NQTLs are multifactorial and each 

difference could be considered a 

different variation, or even a separate 

NQTL. For example, some of these 

commenters highlighted that prior 

authorization or concurrent review may 

take varied forms: an admission that 

requires advance prior authorization; an 

admission that requires notification but 

no clinical review; a nonclinical review 

based on predetermined standards; a 

first-level or nurse clinical review; a 

second-level or physician clinical 

review; and a peer-to-peer clinical 

review. These commenters noted that 

some processes may be automated or 

manual, some may be handled by 

vendors or directly by the plan or issuer, 

and some may have multiple utilization 

management systems within all of the 

aforementioned categories. Another 

commenter highlighted that a plan or 

regulator could conceivably determine 

that ‘‘variations’’ include a wide range 

of aspects, such as the credentials of the 

reviewer, the type or source of clinical 

criteria applied, the timing of the review 

(for example, urgent vs. nonurgent), the 

modality of authorization submission 

(for example, via electronic health 

record vs. fax or pdf form), among 

others. As a result, these commenters 

stated that determining how to identify 

the predominant variation of an NQTL 

may not be feasible without additional 

clarifications. Many commenters 

requested that the Departments provide 

a definition of the term ‘‘variation’’ and 

an explanation of how to determine 

whether a variation exists, as well as 

additional guidance and examples 

illustrating when an NQTL has no 

variation and when an NQTL has 

multiple variations (beyond variations 

based on numerical distinctions). These 

commenters also noted that, under the 

proposed rules, the predominant 

variation may only apply to a small 

percentage of medical/surgical services 

or items in the applicable benefit 

classification. 

Lastly, under the fourth prong, the 

proposed rules provided that an NQTL 

applied to mental health or substance 

use disorder benefits cannot be more 

restrictive than the predominant 

variation of the NQTL applied to 

substantially all medical/surgical 

benefits in the same classification. 

Under the proposed rules, for this 

purpose, an NQTL would be considered 

restrictive if it imposes conditions, 

terms, or requirements that limit access 

to benefits under the terms of the plan 

or coverage. For this purpose, 


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69Code section 9812(a)(3)(A), ERISA section 

712(a)(3)(A), and PHS Act section 2726(a)(3)(A). 

conditions, terms, or requirements 

would include, but not be limited to, 

those that compel an action by or on 

behalf of a participant or beneficiary to 

access benefits or limit access to the full 

range of treatment options available for 

a condition or disorder under the plan. 

As discussed later in this preamble, the 

Departments also proposed that an 

NQTL applied to mental health or 

substance use disorder benefits in any 

classification would not be considered 

to violate the no more restrictive 

requirement if the NQTL impartially 

applies independent professional 

medical or clinical standards or fraud, 

waste, and abuse measures, that meet 

specific requirements. 

Some commenters supported this 

approach to the ‘‘more restrictive’’ part 

of the test in the proposed rules 

because, according to these commenters, 

it provided a more concrete and less 

subjective standard. Other commenters 

emphasized, as discussed earlier in this 

preamble, that the proposed 

mathematical substantially all and 

predominant tests, which provide a 

quantitative basis for comparison, are 

unworkable for NQTLs and 

administratively burdensome. Many of 

these commenters requested that, if the 

proposed mathematical substantially all 

and predominant tests are finalized, the 

Departments provide extensive and 

detailed implementation guidance to 

assist plans and issuers in complying 

with what the commenters 

characterized as this challenging 

framework. Another commenter 

suggested that the Departments establish 

a safe harbor for plans and issuers from 

the substantially all and predominant 

tests for any variation in NQTL 

outcomes data driven by State law or 

regulation. 

The Departments appreciate the 

detailed comments received on all 

aspects of the proposed mathematical 

substantially all and predominant tests, 

including comments particular to each 

aspect of the proposed four-prong test. 

The Departments acknowledge that 

many commenters expressed concerns 

that applying to NQTLs the same 

proposed mathematical substantially all 

and predominant tests that are 

applicable to financial requirements or 

quantitative treatment limitations may 

be difficult to operationalize and could 

be unworkable. The Departments 

acknowledge that this framework was 

first developed for financial 

requirements and quantitative treatment 

limitations, where there are relatively 

clear and limited numbers of variations, 

and that the framework might be 

impractical or impossible for NQTLs, 

which differ in how they are designed 

and applied to various benefits. 

At the same time, the Departments 

agree with commenters who stated that 

applying the statutory no more 

restrictive requirement to NQTLs under 

the proposed rules would assist 

regulators tasked with enforcing 

MHPAEA’s requirements and result in 

overall compliance improvements by 

formalizing and providing greater clarity 

on what plans and issuers must do to 

comply with MHPAEA. The 

Departments also agree with 

commenters who emphasized the 

importance of the statutory requirement 

that plans and issuers shall ensure that 

the treatment limitations they impose 

on mental health and substance use 

disorder benefits generally are no more 

restrictive than those they impose on 

medical/surgical benefits. The proposed 

rules made clear that the incorporation 

of this statutory language into 

regulations is key to ensuring that 

people seeking mental health and 

substance use disorder treatment do not 

face a greater burden on access to 

benefits for such treatment than on 

access to benefits for medical treatment 

and surgical procedures, a premise that 

is central to MHPAEA. 

After reviewing all the comments on 

the proposed four prongs of the no more 

restrictive requirement, the Departments 

have sought to address many of the 

workability concerns expressed by 

commenters, while honoring statutory 

requirements. Specifically, due to 

concerns raised by the commenters, the 

Departments are declining to finalize 

the proposed mathematical substantially 

all and predominant tests for NQTLs, 

which would have based these 

determinations on the dollar amount of 

all plan payments for medical/surgical 

benefits expected to be paid, similar to 

the steps that apply when analyzing 

parity with respect to financial 

requirements or quantitative treatment 

limitations under the 2013 final 

regulations. These final rules address 

commenters’ operability and feasibility 

concerns with respect to the proposed 

mathematical substantially all and 

predominant tests, while continuing to 

set forth a standard for parity 

compliance that is grounded in 

MHPAEA’s statutory text and is also 

sufficiently flexible to account for the 

unique and nonquantifiable nature of 

NQTLs. As noted later in this preamble, 

these final rules retain the focus on the 

design and application of NQTLs, 

including with respect to relevant 

outcomes measures, to ensure that 

NQTLs are no more restrictive in the 

context of mental health and substance 

use disorder benefits than in the context 

of medical/surgical benefits. 

Therefore, these final rules do not 

finalize the provisions proposed under 

26 CFR 54.9812–1(c)(4)(i)(A) through 

(E), 29 CFR 2590.712(c)(4)(i)(A) through 

(E), and 45 CFR 146.136(c)(4)(i)(A) 

through (E). Instead, consistent with 

MHPAEA’s express statutory 

requirement,69 the Departments are 

finalizing under 26 CFR 54.9812–1(c)(4), 

29 CFR 2590.712(c)(4), and 45 CFR 

146.136(c)(4) the general rule that, 

consistent with the fundamental 

purpose of MHPAEA, a group health 

plan (or health insurance coverage 

offered by an issuer in connection with 

a group health plan) may not impose 

any NQTL with respect to mental health 

or substance use disorder benefits in 

any classification that is more 

restrictive, as written or in operation, 

than the predominant NQTL that 

applies to substantially all medical/ 

surgical benefits in the same 

classification. Through this 

requirement, the Departments reiterate 

the importance of promoting the goals of 

the statute and ensuring that individuals 

have access to the mental health and 

substance use disorder benefits under 

their plan or coverage in a way that is 

not more restrictive than their access to 

the medical/surgical benefits under 

their health coverage. For this purpose, 

consistent with the fundamental 

purpose of MHPAEA, an NQTL is more 

restrictive than the predominant NQTL 

that applies to substantially all medical/ 

surgical benefits in the same 

classification if the plan or issuer fails 

to satisfy the design and application 

requirements at 26 CFR 54.9812– 

1(c)(4)(i), 29 CFR 2590.712(c)(4)(i), and 

45 CFR 146.136(c)(4)(i) or the relevant 

data evaluation requirements at 26 CFR 

54.9812–1(c)(4)(iii), 29 CFR 

2590.712(c)(4)(iii), and 45 CFR 

146.136(c)(4)(iii). Accordingly, plans 

and issuers must ensure that the 

processes, strategies, evidentiary 

standards, and other factors used to 

design and apply an NQTL to mental 

health or substance use disorder 

benefits are comparable to, and applied 

no more stringently than, the processes, 

strategies, evidentiary standards, and 

other factors used to design and apply 

the NQTL for medical/surgical benefits, 

including by ensuring that the 

information, evidence, sources, or 

standards on which factors and 

evidentiary standards are based are not 

biased and are objective. Additionally, 

plans and issuers must comply with the 

relevant data evaluation requirements, 


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including by collecting and evaluating 

relevant data, determining whether the 

data suggest an NQTL contributes to 

material differences in relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits, and if material 

differences in relevant outcomes related 

to access exist, taking reasonable action, 

as necessary, to address the material 

differences to ensure compliance, in 

operation, with 26 CFR 54.9812–1(c)(4), 

29 CFR 2590.712(c)(4), and 45 CFR 

146.136(c)(4). Absent compliance with 

both the design and application 

requirements and the relevant data 

evaluation requirements with respect to 

an NQTL, which are addressed in more 

detail later in this preamble, a plan or 

issuer fails to comply with Code section 

9812(a)(3)(A)(ii), ERISA section 

712(a)(3)(A)(ii), and PHS Act section 

2726(a)(3)(A)(ii), as applicable, and may 

not impose the NQTL with respect to 

mental health or substance use disorder 

benefits. These requirements, taken 

together, require a plan to consider and 

evaluate an NQTL’s design, application, 

and resulting outcomes to ensure that an 

NQTL is not more restrictive, as written 

or in operation, than the predominant 

NQTL that applies to substantially all 

medical/surgical benefits in the same 

classification. 

These final rules also include a few 

technical changes to this language, 

including relocation of the reference to 

26 CFR 54.9812–1(a)(1), 29 CFR 

2590.712(a)(1), and 45 CFR 

146.136(a)(1) from the beginning of the 

general rule of the design and 

application requirements to the 

beginning of the regulatory 

requirements for NQTLs at 26 CFR 

54.9812–1(c)(4), 29 CFR 2590.712(c)(4), 

and 45 CFR 146.136(c)(4), to make clear 

that plans and issuers should consider 

the fundamental purpose of MHPAEA 

in complying with all parts of the 

requirements for NQTLs. Additionally, 

the Departments are incorporating the 

phrase ‘‘may not impose’’ from the 

beginning of the proposed regulatory 

requirements for NQTLs, to make clear 

that this standard applies both to the 

design and application of NQTLs. The 

Departments are also replacing the word 

‘‘applied’’ with ‘‘applies’’ in the clause 

describing ‘‘the predominant NQTL that 

applies to substantially all medical/ 

surgical benefits in the same 

classification.’’ This adjustment from 

past to present tense is intended to 

clarify that plans and issuers should 

evaluate compliance with MHPAEA 

with respect to NQTLs that are currently 

imposed under the plan or coverage, 

rather than just those that might have 

been imposed at some point in the past. 

b. Requirements Related to Design and 

Application of the NQTL—26 CFR 

54.9812–1(c)(4)(i), 29 CFR 

2590.712(c)(4)(i), and 45 CFR 

146.136(c)(4)(i) 

The Departments proposed to 

redesignate the requirement at 26 CFR 

54.9812–1(c)(4)(i), 29 CFR 

2590.712(c)(4)(i), and 45 CFR 

146.136(c)(4)(i) in the 2013 final 

regulations as paragraph (c)(4)(ii)(A) and 

amend it to align with the Departments’ 

interpretation that a plan or issuer may 

not impose an NQTL 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 designing and applying (as 

compared to only applying, as under the 

2013 final regulations) the NQTL to 

mental health and substance use 

disorder benefits are comparable to, and 

are applied no more stringently than 

those used in designing and applying 

the limitation with respect to medical/ 

surgical benefits in the classification. To 

codify this interpretation, and for 

consistency with the statutory language 

added by the CAA, 2021, the 

Departments proposed to revise the 

regulatory text to make this requirement 

with respect to designing the NQTL 

explicit. 

Some commenters generally 

supported the proposed design and 

application requirements as part of an 

overall framework for evaluating 

compliance with MHPAEA’s 

requirements with respect to NQTLs. 

Some commenters indicated that they 

have encountered barriers in identifying 

whether plans and issuers comply with 

MHPAEA’s requirements, and this 

proposal would help them identify 

whether the plan or issuer is compliant 

with respect to the design and 

application of NQTLs. Other 

commenters generally opposed the 

proposed changes to the design and 

application requirements. One 

commenter also stated that the design 

and application requirements would not 

improve benefit quality and would also 

constitute an impermissible retroactive 

application of the regulation in the case 

of regulated entities that were not 

required to comply with MHPAEA 

when they designed their benefit plans. 

With respect to commenters’ concern 

that the design and application 

requirements would not improve benefit 

quality, the Departments anticipate that 

greater clarity with respect to these 

requirements, including the definitions 

of the terms ‘‘processes,’’ ‘‘strategies,’’ 

‘‘evidentiary standards,’’ and ‘‘factors’’ 

under these final rules, as discussed 

earlier in this preamble, will help plans 

and issuers assess their compliance and 

remedy any parity violations, which 

will result in improved benefit quality 

overall. The Departments also disagree 

with the concern expressed by 

commenters that the design and 

application requirements impermissibly 

apply to plans and issuers that were not 

required to comply with MHPAEA 

when they designed their benefit plans. 

As stated earlier in this preamble, this 

provision codifies the Departments’ 

longstanding interpretation of the 

design and application requirements 

and the CAA, 2021 amendments to the 

MHPAEA statute. The CAA, 2021 

amendments apply generally to plans 

and issuers that offer both medical/ 

surgical benefits and mental health or 

substance use disorder benefits and 

impose NQTLs on mental health or 

substance use disorder benefits. 

Congress did not exempt plans or 

issuers whose plans or benefit designs 

predated these requirements, and the 

Departments similarly did not take such 

an approach in implementing the 2010 

interim final regulations or the 2013 

final regulations. In fact, as described in 

more detail later in this preamble, 

Congress included a provision in the 

CAA, 2023 that sunsets the option for 

self-funded non-Federal governmental 

plans to elect to opt out of compliance 

with respect to MHPAEA, so that plans 

that previously were exempt from the 

requirements as a result of an opt-out 

election will no longer be able to make 

such an election. 

The Departments are finalizing as 

proposed the general rule with respect 

to the design and application 

requirements for NQTLs, with a few 

minor amendments. Accordingly, this 

provision clarifies that to satisfy these 

requirements, a plan or issuer must 

consider, as part of its assessment of an 

NQTL’s compliance with the no more 

restrictive requirement, whether any 

processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the NQTL to 

mental health or substance use disorder 

benefits in the classification are 

comparable to, and are applied no more 

stringently than those used in designing 

and applying the limitation with respect 

to medical/surgical benefits in the 

classification. By requiring processes, 

strategies, evidentiary standards, or 

other factors used to be comparable to 

and applied no more stringently than, 

the design and application requirements 


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77604 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

of these final rules give meaning to the 

statutory terms ‘‘substantially all’’ and 

‘‘predominant.’’ By making explicit in 

these final rules the Departments’ 

interpretation of the design and 

application requirements, and codifying 

the requirements of the CAA, 2021, this 

provision will help plans and issuers 

better understand their MHPAEA 

compliance obligations with respect to 

NQTLs, by emphasizing that, as written 

and in operation, the design of an NQTL 

is equally relevant as how it is applied. 

The design and application 

requirements of these final rules will 

also ensure that plans and issuers do not 

place greater burdens on access to 

mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits. 

The Departments note that a plan or 

issuer must comply with the relevant 

requirements under these final rules 

with respect to NQTLs applicable to 

mental health or substance use disorder 

benefits once the final rules become 

applicable to the plan or coverage, 

including with respect to any NQTLs 

that were developed and imposed when 

a plan or issuer was not subject to 

MHPAEA and that continue to be 

imposed after the applicability date. 

However, these final rules are not 

applicable to an NQTL imposed with 

respect to mental health or substance 

use disorder benefits for any such prior 

period of time (including a period when 

MHPAEA was not applicable). 

In these final rules, the Departments 

are codifying the design and application 

requirements at 26 CFR 54.9812– 

1(c)(4)(i)(A), 29 CFR 

2590.712(c)(4)(i)(A), and 45 CFR 

146.136(c)(4)(i)(A), rather than as 

proposed at 26 CFR 54.9812– 

1(c)(4)(ii)(A), 29 CFR 

2590.712(c)(4)(ii)(A), and 45 CFR 

146.136(c)(4)(ii)(A) because, as 

discussed earlier in this preamble, these 

final rules structure the design and 

application requirements as part of the 

statutory no more restrictive 

requirement, rather than as a unique 

prong of the three requirements for 

NQTLs included in the proposed rules. 

In addition, the Departments are making 

a technical correction by amending the 

regulatory text to refer to health 

insurance coverage, rather than an 

issuer, to generally use consistent 

terminology throughout the regulations. 

Finally, as noted earlier in this 

preamble, these final rules move the 

reference to 26 CFR 54.9812–1(a)(1), 29 

CFR 2590.712(a)(1), and 45 CFR 

146.136(a)(1) from the beginning of the 

general rule of the design and 

application requirements to the 

beginning of the regulatory 

requirements for NQTLs at 26 CFR 

54.9812–1(c)(4), 29 CFR 2590.712(c)(4), 

and 45 CFR 146.136(c)(4). 

Prohibition on Discriminatory Factors 

and Evidentiary Standards 

The proposed rules would add a new 

provision that, for purposes of 

determining comparability and 

stringency under the design and 

application requirements of proposed 26 

CFR 54.9812–1(c)(4)(ii)(A), 29 CFR 

2590.712(c)(4)(ii)(A), and 45 CFR 

146.136(c)(4)(ii)(A), plans and issuers 

would be prohibited from relying upon 

any factor or evidentiary standard if the 

information, evidence, sources, or 

standards on which the factor or 

evidentiary standard is based 

discriminate against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits. 

The proposed rules stated that 

information would be considered to 

discriminate against mental health or 

substance use disorder benefits if it is 

biased or not objective, in a manner that 

results in less favorable treatment of 

mental health or substance use disorder 

benefits, based on all the relevant facts 

and circumstances. Such relevant facts 

and circumstances would include, but 

not be limited to, the source of the 

information, the purpose or context of 

the information, and the content of the 

information. Therefore, under the 

proposed rules, plans and issuers would 

not be permitted to rely on information 

that reflects bias, as those factors or 

evidentiary standards would be 

discriminatory. 

For this purpose, the Departments 

stated in the proposed rules that 

information resulting in the less 

favorable treatment of mental health and 

substance use disorder benefits without 

legitimate justification or that is 

otherwise not objective would be 

considered to be biased and to 

discriminate against mental health and 

substance use disorder benefits. When 

determining which information, 

evidence, sources, or standards should 

inform the factors or evidentiary 

standards used to design or apply an 

NQTL, plans and issuers would not be 

permitted under the proposed rules to 

use information, evidence, sources, or 

standards if they are biased in favor of 

imposing greater restrictions on access 

to covered mental health and substance 

use disorder benefits or not objective, 

based on all the relevant facts and 

circumstances. The Departments also 

proposed that impartially applied 

independent professional medical or 

clinical standards and fraud, waste, and 

abuse measures that meet specific 

requirements would qualify for an 

exception and would not be considered 

to discriminate against mental health or 

substance use disorder benefits. 

Additionally, in the preamble to the 

proposed rules the Departments noted 

that the proposed prohibition on 

discriminatory factors and evidentiary 

standards would prohibit plans and 

issuers from relying on historical plan 

data or other historical information from 

a time when the plan or coverage was 

not subject to MHPAEA or was in 

violation of MHPAEA’s requirements, 

where the use of such data results in 

less favorable treatment of mental health 

and substance use disorder benefits. The 

Departments provided an example 

illustrating that a plan or issuer would 

not be permitted to calculate 

reimbursement rates based on historical 

data on total plan spending for each 

specialty that is divided between mental 

health and substance use disorder 

providers and medical/surgical 

providers, when the total spending by 

the plan was based on a time period 

when the plan or coverage was not 

subject to MHPAEA or was in violation 

of MHPAEA, if the data result in less 

favorable treatment of mental health and 

substance use disorder benefits. 

Consequently, under the framework in 

the proposed rules, plans and issuers 

could not use such data to develop a 

factor or evidentiary standard for the 

design or application of an NQTL to 

mental health or substance use disorder 

benefits. The proposed rules stated, to 

the extent a plan or issuer relies on any 

factor or evidentiary standard that 

discriminates against mental health or 

substance use disorder benefits, or any 

information, evidence, sources, or 

standards that inform such factors or 

evidentiary standards to design and 

apply NQTLs, the plan or issuer would 

violate the prohibition on 

discriminatory factors and evidentiary 

standards set forth in proposed 26 CFR 

54.9812–1(c)(4)(ii)(B), 29 CFR 

2590.712(c)(4)(ii)(B), and 45 CFR 

146.136(c)(4)(ii)(B). 

Many commenters expressed general 

support for this provision of the 

proposed rules. For example, one 

commenter noted that the prohibition 

on discriminatory factors and 

evidentiary standards would more 

effectively protect against the 

inappropriate application of NQTLs 

that, although appearing to be compliant 

with MHPAEA as written, have a 

disproportionately negative effect on 

access to mental health and substance 

use disorder benefits. Some commenters 

also indicated that the proposed 

provision is consistent with the text and 

purpose of MHPAEA, as well as the 

ACA, and favored a broad interpretation 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77605 

70As noted earlier in this preamble, the 

Departments are codifying the design and 

application requirements (including the prohibition 

on discriminatory factors and evidentiary 

standards) at 26 CFR 54.9812–1(c)(4)(i), 29 CFR 

2590.712(c)(4)(i), and 45 CFR 146.136(c)(4)(i), rather 

than as proposed at 26 CFR 54.9812–1(c)(4)(ii), 29 

CFR 2590.712(c)(4)(ii), and 45 CFR 146.136(c)(4)(ii), 

because these final rules structure the design and 

application requirements as part of the no more 

restrictive requirement, rather than as a unique 

prong of the 3-part test proposed in the proposed 

rules. 

of the requirement to address particular 

examples of discrimination by plans 

and issuers, to which some of them 

expressly cited. Other commenters 

expressed opposition to the proposed 

prohibition on discriminatory factors 

and evidentiary standards. Some of 

these commenters stated that the 

proposal would be administratively 

burdensome, and it would be difficult 

for plans and issuers to operationalize 

due to ambiguity and inherent 

subjectivity. Some commenters opposed 

to the proposed prohibition stated that 

it is duplicative of the proposed relevant 

data evaluation requirements. These 

commenters thought the prohibition on 

discriminatory factors and evidentiary 

standards should be eliminated as 

superfluous, because the required 

evaluation of outcomes data under the 

proposed rules is intended to ensure 

that factors are applied no more 

stringently to mental health and 

substance use disorder benefits than 

medical/surgical benefits and do not 

result in a material difference in access. 

Some commenters expressed concern 

that the proposed requirement that 

information must not be biased and 

must be objective (which is based on 

facts and circumstances) is too 

subjective, can only be determined 

retroactively (yet must be applied 

prospectively), and is too difficult to 

apply for plans or issuers to be certain 

of compliance. One commenter 

requested clarification on the 

documentation and evidence required to 

demonstrate the absence of bias. 

Another commenter expressed concern 

that plans may not have the ability to 

prove that information is unbiased and 

objective. 

One commenter stated that it is 

unclear whether the Departments intend 

to focus on the factors and evidentiary 

standards themselves or on the effects of 

using those factors and standards. Some 

commenters assumed that whether a 

factor or evidentiary standard is 

discriminatory would be based on an 

evaluation of outcomes, and that 

therefore any disparity in outcomes data 

could be viewed as use of a 

discriminatory factor or evidentiary 

standard. These commenters requested 

examples of outcomes that would 

demonstrate compliance. In addition, 

many commenters requested examples 

of discriminatory factors and 

evidentiary standards and of 

nondiscriminatory information and data 

sources. Several commenters requested 

the Departments to make clear that 

plans and issuers may not establish 

compliance by relying on a fee schedule 

used by Medicare, although another 

commenter requested that plans and 

issuers be able to access a safe harbor if 

they paid above-Medicare rates. 

After considering commenters’ 

feedback, the Departments are finalizing 

the prohibition on discriminatory 

factors and evidentiary standards with 

modifications. As the Departments 

stated in the preamble to the proposed 

rules this provision will help address 

the concern that various factors and 

evidentiary standards that plans and 

issuers have relied on to design NQTLs 

with respect to mental health or 

substance use disorder benefits might 

themselves discriminate against mental 

health and substance use disorder 

benefits by treating them in a less 

favorable manner. At the same time, the 

Departments acknowledge commenters’ 

concerns about potential ambiguities in 

the proposed prohibition on 

discriminatory factors and evidentiary 

standards, questions about whether this 

provision is duplicative of other parts of 

the proposed rules, and confusion about 

how to operationalize the prohibition. 

In response to these concerns, and to 

assist plans and issuers in complying 

with the prohibition on discriminatory 

factors and evidentiary standards in 

these final rules, the Departments have 

modified the prohibition by providing 

additional clarity regarding what it 

means for information, evidence, 

sources, or standards to be ‘‘biased or 

not objective.’’ The final rules both 

clarify the prohibition in a manner to 

ensure that it can be applied 

prospectively and revise it to expressly 

provide that potentially biased or not 

objective information, evidence, 

sources, or standards can be corrected, 

cured, or supplemented, and then relied 

upon by a plan or issuer to inform a 

factor or evidentiary standard that is not 

discriminatory. The Departments also 

provide additional examples of 

discriminatory factors and evidentiary 

standards later in this preamble. 

First, with respect to the general 

prohibition on discriminatory factors 

and evidentiary standards, these final 

rules at 26 CFR 54.9812–1(c)(4)(i)(B), 29 

CFR 2590.712(c)(4)(i)(B), and 45 CFR 

146.136(c)(4)(i)(B) 70 provide that, for 

purposes of determining comparability 

and stringency under 26 CFR 54.9812– 

1(c)(4)(i)(A), 29 CFR 

2590.712(c)(4)(i)(A), and 45 CFR 

146.136(c)(4)(i)(A), a plan (or health 

insurance coverage) may not rely upon 

discriminatory factors and evidentiary 

standards to design an NQTL to be 

imposed on mental health or substance 

use disorder benefits. The Departments 

intend that the focus of this prohibition 

be specifically on the design of NQTLs, 

to further distinguish the prohibition on 

discriminatory factors and evidentiary 

standards from the relevant data 

evaluation requirements. These final 

rules provide the necessary clarity for 

plans and issuers to determine whether 

information, evidence, sources, or 

standards are biased or not objective, 

and if so, cannot be used as the basis for 

a factor or evidentiary standard used to 

design an NQTL applicable to mental 

health or substance use disorder 

benefits. 

Specifically, these final rules state 

that a factor or evidentiary standard is 

discriminatory if the information, 

evidence, sources, or standards on 

which the factor or evidentiary standard 

are based are biased or not objective in 

a manner that discriminates against 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. This language is 

similar to that included under proposed 

26 CFR 54.9812–1(c)(4)(ii)(B), 29 CFR 

2590.712(c)(4)(ii)(B), and 45 CFR 

146.136(c)(4)(ii)(B) but adds the phrase 

‘‘is biased or not objective in a manner 

that,’’ preceding the word 

‘‘discriminates.’’ This phrase, in 

conjunction with the other changes to 

the prohibition on discriminatory 

factors and evidentiary standards 

discussed later in this preamble, was 

modified in response to comments and 

is intended to help clarify that a plan or 

issuer is expected to assess whether the 

information, evidence, sources, or 

standards on which each factor or 

evidentiary standard are based are 

biased or not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits. 

This analysis is distinct from the final 

rules’ requirement to compare the 

comparability and stringency of factors 

and evidentiary standards used to 

design and apply an NQTL. 

Second, the Departments are 

finalizing a modified version of the 

provision originally proposed under 26 

CFR 54.9812–1(c)(4)(ii)(B)(3), 29 CFR 

2590.712(c)(4)(ii)(B)(3), and 45 CFR 

146.136(c)(4)(ii)(B)(3) as 26 CFR 

54.9812–1(c)(4)(i)(B)(1), 29 CFR 

2590.712(c)(4)(i)(B)(1), and 45 CFR 

146.136(c)(4)(i)(B)(1) of these final rules. 

This provision of the proposed rules 


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77606 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

71The Medicare Physician Fee Schedule is 

developed by CMS. To develop the Medicare 

Physician Fee Schedule, CMS utilizes 

recommendations from an independent assessment 

by a multi-specialty body and other market-based 

information sources, as well as independent 

assessment by CMS medical officers, to develop 

proposed relative value units for each physician 

service. CMS then engages in notice and comment 

rulemaking, including consideration of public 

comments, before establishing payment rates for 

specific services. Furthermore, CMS has made, and 

continues to make, numerous adjustments to the 

underlying methodology to increasingly ensure 

appropriate reimbursement for services paid under 

the Medicare Physician Fee Schedule, including 

behavioral health services. See, e.g., Medicare and 

Medicaid Programs; CY 2024 Payment Policies 

Under the Physician Fee Schedule and Other 

Changes to Part B Payment and Coverage Policies; 

Medicare Shared Savings Program Requirements; 

Medicare Advantage; Medicare and Medicaid 

Provider and Supplier Enrollment Policies; and 

Basic Health Program, 88 FR 78818 (Nov. 16, 2023). 

provided that information is considered 

to discriminate against mental health or 

substance use disorder benefits if it is 

biased or not objective, in a manner that 

results in less favorable treatment of 

mental health or substance use disorder 

benefits, based on all the relevant facts 

and circumstances. As mentioned 

earlier in this preamble, the 

Departments received many comments 

opposing this provision as proposed, 

including comments expressing 

confusion as to how it is different from 

the relevant data evaluation 

requirements, questions regarding the 

kind of documentation and evidence 

needed to show compliance, and 

concern that it is subjective and difficult 

to operationalize. 

The prohibition on discriminatory 

factors and evidentiary standards is 

intended to work together with the other 

provisions of these final rules, including 

the relevant data evaluation 

requirements. Like all the provisions of 

these final rules, the provision further 

implements the statutory requirement 

that NQTLs be no more restrictive with 

respect to mental health or substance 

use disorder benefits than the 

predominant limitations applicable to 

substantially all medical/surgical 

benefits. The test specifically focuses on 

the importance of ensuring that the 

factors and evidentiary standards relied 

upon by plans and issuers in designing 

NQTLs do not have built-in biases (at 

the time NQTLs are designed) against 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. To the extent plans 

and issuers rely upon factors and 

evidentiary standards to design NQTLs 

that systematically disfavor access or are 

specifically designed to disfavor access 

to mental health and substance use 

disorder benefits, the resultant NQTLs 

are more restrictive with respect to 

mental health or substance use disorder 

benefits than for medical/surgical 

benefits. 

The Departments note that a factor or 

evidentiary standard may be based on or 

include information that solely relates 

to medical/surgical benefits (and is 

silent or without corollary with respect 

to mental health or substance use 

disorder benefits). Such a factor or 

evidentiary standard is not considered 

discriminatory for this purpose. For 

example, a plan can reasonably rely on 

a source of information on the clinical 

efficacy of a treatment or service to 

inform a factor used to design a medical 

management NQTL, even though that 

source does not address the clinical 

efficacy of any treatment of any mental 

health conditions or substance use 

disorders, without violating the 

prohibition on discriminatory factors 

and evidentiary standards. However, the 

use of such factor or evidentiary 

standard must comply with the design 

and application requirements, as 

described earlier in this preamble. 

In response to comments to provide 

additional clarity, the final rules 

elaborate on the meaning of the phrase 

‘‘biased and not objective in a manner 

that discriminates against mental health 

or substance use disorder benefits.’’ 

Specifically, these final rules provide 

that information, evidence, sources, or 

standards are considered to be biased or 

not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

if, based on all the relevant facts and 

circumstances, they systematically 

disfavor access or are specifically 

designed to disfavor access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

For purposes of determining whether 

information, evidence, sources, or 

standards are considered to be biased or 

not objective under these final rules, 

relevant facts and circumstances may 

include, but are not limited to, the 

reliability of information, evidence, 

sources, or standards, including any 

underlying data and the independence 

of the information, evidence, sources, 

and standards relied upon. The 

Departments note that internal data or 

information, such as claims data, would 

generally not be considered 

independent, but would not necessarily 

be considered discriminatory on that 

basis alone. In the Departments’ view, 

independence is a relevant fact and 

circumstance for determining whether 

information, evidence, sources, or 

standards are considered to be biased or 

not objective. For example, a standard 

that is created or funded by the plan or 

issuer, or its service provider, would 

likely lack independence compared to a 

standard created by an impartial third 

party or governmental entity, and might 

require strong indicators of reliability in 

order to demonstrate that it is objective 

and unbiased. Additionally, relevant 

facts and circumstances include the 

analyses and methodologies employed 

to select the information, evidence, 

sources, or standards, and the 

consistency of their application; and 

any known safeguards deployed to 

prevent reliance on skewed data or 

metrics when determining whether they 

are biased or not objective. The 

Departments note that these final rules 

only provide examples, and not a 

comprehensive list, of relevant facts and 

circumstances that indicate information, 

evidence, sources, or standards are 

biased or not objective. Because plans 

and issuers rely on myriad factors and 

evidentiary standards to design NQTLs 

for their own unique benefit designs, 

this evaluation necessarily will be 

specific to the particular plan or 

coverage. 

Under these final rules, information, 

evidence, sources, and standards are not 

considered biased or not objective for 

purposes of the prohibition on 

discriminatory factors and evidentiary 

standards, if a plan or issuer has taken 

steps necessary to address the bias or 

lack of objectivity by correcting, curing, 

or supplementing the information, 

evidence, sources, or standards that 

would have been biased or not objective 

in the absence of such steps. If 

information, evidence, sources, or 

standards are corrected, cured, or 

supplemented, they may be used by 

plans and issuers as the basis for factors 

and evidentiary standards used to 

design an NQTL. 

Several commenters asked about the 

use of a fee schedule used by Medicare 

and CMS-set standards, such as network 

time and distance standards, by a plan 

or issuer to inform plan design. For 

example, some plans use the Medicare 

Physician Fee Schedule 71 to establish 

base rates for in-network physician 

services. The Departments do not 

consider fee schedules used by 

Medicare and standards set by CMS to 

be biased or not objective, as defined 

under these rules, when used as the 

basis for a factor or evidentiary standard 

to design an NQTL such as 

reimbursement rate methodology. 

The Departments note, however, that 

the mere use of the Medicare Physician 

Fee Schedule, for example, as one type 

of information, evidence, source, or 

standard that informs a factor used to 

design an NQTL does not automatically 


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render the NQTL permissible. For 

example, in most cases, a plan would be 

unable to justify a reimbursement rate 

methodology that paid physicians in 

medical/surgical specialties 125 percent 

of the Medicare Physician Fee Schedule 

rate and that paid physicians in mental 

health and substance use disorder 

specialties 75 percent of the Medicare 

Physician Fee Schedule rate. 

The Departments received several 

comments in support of the example 

included in the preamble to the 

proposed rules that illustrated the 

prohibition on plans’ and issuers’ 

reliance on historical plan data or other 

historical information from a time when 

the plan or coverage was not subject to 

MHPAEA, or not compliant with 

MHPAEA. Some commenters 

recognized that many plans and issuers 

have used their own historical data from 

a time when their plan or coverage was 

not subject to MHPAEA and have 

benefited from historic inequities in 

benefit structures that MHPAEA sought 

to prohibit. One commenter requested 

that this example be codified in the 

regulatory text of the final rules. The 

Departments agree that the example 

illustrating how the prohibition on 

discriminatory factors and evidentiary 

standards applies to the use of historical 

data and information to design an NQTL 

should be clearly set forth in the 

regulation text at 26 CFR 54.9812– 

1(c)(4)(ii)(B)(2), 29 CFR 

2590.712(c)(4)(ii)(B)(2), and 45 CFR 

146.136(c)(4)(ii)(B)(2). To ensure 

compliance with this standard, plans 

and issuers that utilize historical data or 

information from a time when their plan 

or coverage was not subject to, or not 

compliant with, MHPAEA should 

ensure that the use of such data and 

information (for example, in cost 

calculations and controls) for mental 

health and substance use disorder 

benefits does not include, as a baseline, 

years when financial requirements and 

treatment limitations that would have 

been impermissible under MHPAEA 

were imposed on such benefits (unless 

they take steps to correct, cure, or 

supplement the data or information, as 

discussed earlier in this preamble). 

Some commenters provided other 

examples that they recommended 

including as illustrations of 

discriminatory factors and evidentiary 

standards in these final rules, including 

prior authorization for a prescription of 

buprenorphine to treat opioid use 

disorder (OUD) requiring additional 

licensure or certification for mental 

health and substance use disorder 

providers that is not required of similar 

medical/surgical providers; subjecting 

mental health and substance use 

disorder claims to different fraud, waste, 

and abuse processes, or requiring more 

documentation, than for medical/ 

surgical claims; not covering nutrition 

counseling for the treatment of eating 

disorders while covering it for medical 

conditions; and requiring that mental 

health and substance use disorder 

claims and appeals be filed with a TPA, 

but not making this clear to enrollees, 

nor properly coordinating operations 

between the plan/issuer and TPA. 

However, many of these examples 

focus on the use of a factor to apply an 

NQTL to mental health and substance 

use disorder benefits in a manner that 

is not comparable or is more stringent 

than the use of the factor to apply an 

NQTL to medical/surgical benefits, or 

focus on the NQTL itself (rather than the 

discriminatory factor or evidentiary 

standard). The prohibition on 

discriminatory factors and evidentiary 

standards in these final rules, however, 

focuses on the information, evidence, 

sources, and standards that inform the 

factors and evidentiary standards used 

to design an NQTL. Factors and 

evidentiary standards that incorporate 

or otherwise rely on underlying data or 

information that systematically disfavor 

access or are specifically designed to 

disfavor access to mental health or 

substance use disorder benefits place a 

greater burden on access to such 

benefits. Therefore, these final rules 

prohibit the use of any factor or 

evidentiary standard to design an NQTL 

if the underlying information, evidence, 

sources, and standards are themselves 

biased or not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

unless the plan or issuer takes steps to 

correct, cure, or supplement the 

information, evidence, sources and 

standards to address the bias or lack of 

objectivity. 

These final rules set forth a general 

rule to determine which specific factors 

and evidentiary standards (and the 

information, evidence, sources, and 

standards on which they are based) 

might or might not be biased and not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. The 

Departments have provided new 

examples in these final rules illustrating 

the prohibition on discriminatory 

factors and evidentiary standards, 

which are discussed later in this 

preamble. The Departments 

acknowledge that these examples are 

not exhaustive and may provide 

additional examples in future guidance. 

Finally, as discussed in greater detail 

later in this preamble, the Departments 

are not finalizing the exceptions to the 

prohibition on discriminatory factors 

and evidentiary standards for 

independent professional medical or 

clinical standards and fraud, waste, and 

abuse measures. However, these final 

rules expressly clarify at 26 CFR 

54.9812–1(c)(4)(i)(B)(3), 29 CFR 

2590.712(c)(4)(i)(B)(3), and 45 CFR 

146.136(c)(4)(i)(B)(3) that generally 

recognized independent professional 

medical or clinical standards and fraud 

and abuse measures that minimize the 

negative impact on access to appropriate 

mental health and substance use 

disorder benefits are not information, 

evidence, sources, or standards that are 

biased or not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits. 

The Departments recognize that 

commenters requested specificity as to 

what qualifies as independent 

professional medical or clinical 

standards. To ensure that they are not 

biased and are objective, independent 

professional medical or clinical 

standards should reflect the standards of 

care and clinical practice that are 

generally recognized in relevant clinical 

specialties across a range of settings of 

care and should be transparent. For 

example, sources that include such 

standards could be peer-reviewed 

scientific studies and medical literature, 

formal published recommendations of 

Federal Government agencies, drug 

labeling approved by the United States 

Food and Drug Administration (FDA), 

and recommendations of relevant 

nonprofit health care provider 

professional associations and specialty 

societies, including, but not limited to, 

patient placement criteria and clinical 

practice guidelines. Additionally, fraud 

and abuse measures should be reliably 

established through unbiased and 

objective data and narrowly tailored in 

a manner that minimizes the negative 

impact on access to appropriate mental 

health and substance use disorder 

benefits. 

These final rules also clarify that 

plans and issuers that rely on 

independent professional medical or 

clinical standards or fraud and abuse 

measures must comply with the general 

rule of the design and application 

requirements at 26 CFR 54.9812– 

1(c)(4)(i)(A), 29 CFR 

2590.712(c)(4)(i)(A), and 45 CFR 

146.136(c)(4)(i)(A). If such a standard or 

measure is used as an NQTL, the plan 

or issuer also must comply with the 

relevant data evaluation requirements at 

26 CFR 54.9812–1(c)(4)(iii), 29 CFR 


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77608 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

72See, e.g., 2022 MHPAEA Report to Congress 

(Jan. 2022), pg. 13, 19–20, https://www.dol.gov/ 

sites/dolgov/files/EBSA/laws-and-regulations/laws/ 

mental-health-parity/report-to-congress-2022- 

realizing-parity-reducing-stigma-and-raisingawareness.pdf; 2023 MHPAEA Comparative 

Analysis Report to Congress (July 2023), pg. 47–48, 

55–56, https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/laws/mental-healthparity/report-to-congress-2023-mhpaeacomparative-analysis.pdf and https://www.cms.gov/ 

cciio/resources/forms-reports-and-otherresources#mental-health-parity. 

73See Self-Compliance Tool for the Mental 

Health Parity and Addiction Equity Act (MHPAEA) 

(2020), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/laws/mental-healthparity/self-compliance-tool.pdf. 

2590.712(c)(4)(iii), and 45 CFR 

146.136(c)(4)(iii) in these final rules. 

c. Illustrative, Non-Exhaustive List of 

NQTLs—26 CFR 54.9812–1(c)(4)(ii), 29 

CFR 2590.712(c)(4)(ii), and 45 CFR 

146.136(c)(4)(ii) 

The proposed rules proposed to move 

the illustrative, non-exhaustive list of 

NQTLs from 26 CFR 54.9812–1(c)(4)(ii), 

29 CFR 2590.712(c)(4)(ii), and 45 CFR 

146.136(c)(4)(ii) to 26 CFR 54.9812– 

1(c)(4)(iii), 29 CFR 2590.712 (c)(4)(iii), 

and 45 CFR 146.136(c)(4)(iii) and make 

several minor changes to this list. First, 

the Departments proposed amendments 

to make clear that this illustrative list of 

NQTLs is non-exhaustive and that there 

are additional NQTLs not captured in 

the list. The Departments also proposed 

to amend the illustrative, nonexhaustive list of NQTLs to replace 

‘‘[s]tandards for provider admission to 

participate in a network, including 

reimbursement rates’’ with ‘‘standards 

related to network composition, 

including, but not limited to, standards 

for provider and facility admission to 

participate in a network or for 

continued network participation, 

including methods for determining 

reimbursement rates, credentialing 

standards, and procedures for ensuring 

the network includes an adequate 

number of each category of provider and 

facility to provide covered services 

under the plan or coverage.’’ 

Additionally, the Departments proposed 

to amend the description of the 

illustrative NQTL ‘‘plan methods for 

determining usual, customary, and 

reasonable charges’’ to encompass a 

broader range of methods for 

determining out-of-network rates, such 

as allowed amounts; usual, customary, 

and reasonable charges; or application 

of other external benchmarks for out-ofnetwork rates. Finally, the Departments 

proposed to add a specific reference to 

prior authorization requirements as an 

example of a medical management 

standard limiting or excluding benefits 

based on medical necessity or medical 

appropriateness, consistent with 

Example 1 in 26 CFR 54.9812– 

1(c)(4)(iii), 29 CFR 2590.712(c)(4)(iii), 

and 45 CFR 146.136(c)(4)(iii) of the 2013 

final regulations. 

Some commenters supported the 

clarification in the proposed rules that 

the illustrative list is non-exhaustive 

and that there are additional NQTLs not 

included in the list. In general, many 

commenters found the list to be helpful 

for plans and issuers to identify NQTLs. 

Some of these commenters pointed out 

that the non-exhaustive nature of the list 

would allow new NQTLs developed by 

plans and issuers to fall under the scope 

of the requirements in these final rules. 

One commenter also noted that the 

definition of an NQTL is sufficiently 

clear such that an exhaustive list would 

not be needed to put plans or issuers on 

notice of their compliance obligations. 

Other commenters requested that the 

Departments instead provide an 

exhaustive list of NQTLs to eliminate 

uncertainty, promote consistency, and 

clarify plans’ and issuers’ compliance 

obligations. Several of these 

commenters suggested that the 

Departments update such an exhaustive 

list as new NQTLs are identified and 

allow adequate time for plans and 

issuers to come into compliance with 

respect to such NQTLs. Other 

commenters advocated for an approach 

where an exhaustive list of NQTLs 

would also represent the scope of 

NQTLs for which the relevant Secretary 

could request a comparative analysis. 

Some of these commenters requested 

that to the extent the relevant Secretary 

requested a comparative analysis for an 

NQTL not on the list, plans and issuers 

be provided with additional time to 

respond. 

The Departments agree with the 

commenter generally stating that the 

definition of an NQTL under 26 CFR 

54.9812–1(a), 29 CFR 2590.712(a), and 

45 CFR 146.136(a), in addition to the 

non-exhaustive, illustrative list of 

NQTLs, is sufficient to put plans and 

issuers on notice that a given plan 

provision would fall under the 

definition of an NQTL. Therefore, the 

Departments are finalizing as proposed 

the clarification that this illustrative list 

of NQTLs is non-exhaustive. 

The Departments decline to provide 

an exhaustive list of NQTLs, as 

requested by commenters, in these final 

rules; however, as described further 

below, the Departments may consider 

issuing separate guidance to add 

additional examples if needed. Plans 

and issuers, rather than the 

Departments, are best positioned to 

initially identify NQTLs, including any 

NQTLs that plans and issuers newly 

implement as their plan or coverage 

designs evolve over time. MHPAEA 

does not limit the scope of NQTLs that 

plans and issuers may impose on mental 

health and substance use disorder 

benefits. However, for any NQTLs 

applicable to such benefits, a plan or 

issuer must comply with MHPAEA and 

its implementing regulations. Any 

exhaustive list of NQTLs published by 

the Departments would likely lag 

behind those actually utilized by plans 

and issuers due to this information gap, 

along with the wide variability in 

NQTLs that exist now and could exist 

in the future. Furthermore, while some 

commonalities exist, plans and issuers 

generally do not use uniform 

nomenclature to refer to their medical 

management techniques or other 

NQTLs, making the task of identifying 

an exhaustive list difficult, if not 

impossible. 

An exhaustive list of NQTLs that does 

not include the full scope of NQTLs 

utilized by plans and issuers at any 

given time would undermine the 

fundamental purpose of MHPAEA and 

these final rules. While the Departments 

acknowledge and have considered 

plans’ and issuers’ requests for a finite 

list of NQTLs for which the 

Departments may request comparative 

analyses, the exhaustive nature of such 

a list would leave open a compliance 

loophole by incentivizing plans and 

issuers to wait to evaluate, document, 

and address compliance for an NQTL 

that is newly developed or has not come 

to the attention of the Departments. The 

approach some commenters suggested 

to expressly limit the comparative 

analysis requirement under 26 CFR 

54.9812–2, 29 CFR 2590.712–1, and 45 

CFR 146.137 to only those NQTLs 

identified in an exhaustive list is 

similarly untenable due to a foreseeable 

mismatch between the NQTLs included 

on such an exhaustive list, and those 

utilized by plans and issuers over time, 

particularly where the Departments may 

receive a complaint or have reason to 

believe there may be a potential 

violation. The Departments recognize 

the desire of plans and issuers to have 

a list of NQTLs on which the 

Departments will focus their 

enforcement efforts. The Departments 

highlight that the most recent reports to 

Congress on MHPAEA contain lists of 

the NQTLs on which the Departments 

have focused their enforcement efforts, 

and the NQTLs the Departments have 

mostly commonly found to be 

noncompliant.72 Additionally, the 2020 

MHPAEA Self-Compliance Tool 

includes an illustrative, non-exhaustive 

list of NQTLs.73 The statute, however, 

requires the Departments to request 


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74Code section 9812(a)(8)(A), ERISA section 

712(a)(8)(A), and PHS Act section 2726(a)(8)(A). 

comparative analyses from a plan or 

issuer for any NQTL that involves 

potential violations of MHPAEA or 

complaints regarding noncompliance 

with MHPAEA that concern NQTLs. To 

limit the Departments to requesting 

comparative analyses for only certain 

NQTLs identified in a list would not 

only be inconsistent with the statute but 

would also limit the ability of the 

Departments to dynamically respond to 

new NQTLs that plans and issuers 

design and apply that may restrict 

participant and beneficiary access to 

mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits. 

Additionally, allowing plans and 

issuers to categorically have additional 

time to assemble a comparative analysis 

for NQTLs that are not on a finite list 

of NQTLs, as requested by commenters, 

would also be inconsistent with the 

statutory requirement that, without 

exception, plans and issuers perform 

and document such comparative 

analyses of NQTLs applicable to mental 

health or substance use disorder 

benefits, beginning 45 days after the 

enactment of the CAA, 2021, and would 

result in the post-hoc justifications 

addressed with the CAA, 2021’s 

enactment.74 The Departments 

nonetheless acknowledge commenters’ 

requests for additional guidance about 

plan provisions that would be 

considered to be NQTLs and intend to 

provide additional examples of NQTLs 

through future reports to Congress, 

updates to the 2020 MHPAEA SelfCompliance Tool, and other guidance. 

The Departments received a handful 

of comments on the proposed expansion 

of the illustrative list’s description of 

standards for provider admission to 

participate in a network, including 

reimbursement rates, to also refer to 

standards for provider and facility 

admission to participate in a network or 

for continued network participation, 

including methods for determining 

reimbursement rates, credentialing 

standards, and procedures for ensuring 

the network includes an adequate 

number of each category of provider and 

facility to provide covered services 

under the plan or coverage. Some 

commenters supported these proposed 

amendments to ensure that patients 

have an adequate provider network. 

Others suggested that parity 

requirements for provider networks 

should address the administrative 

burden and credentialing requirements 

on providers when joining networks, 

which may limit network adequacy. The 

Departments are finalizing this 

amendment as proposed. The 

Departments agree with commenters 

who stated that MHPAEA applies to 

credentialing standards, as well as the 

procedures to join a network, and note 

that methods for determining 

reimbursement rates, credentialing 

standards, and procedures for ensuring 

the network includes an adequate 

number of each category of provider and 

facility to provide services under the 

plan or coverage are intended to be 

interpreted broadly, consistent with the 

fundamental purpose of MHPAEA. 

Because these final rules do not retain 

the proposed mathematical substantially 

all and predominant tests, the 

illustrative list appears in these final 

rules at 26 CFR 54.9812–1(c)(4)(ii), 29 

CFR 2590.712(c)(4)(ii), and 45 CFR 

146.136(c)(4)(ii) instead of 26 CFR 

54.9812–1(c)(4)(iii), 29 CFR 

2590.712(c)(4)(iii), and 45 CFR 

146.136(c)(4)(iii) as in the proposed 

rules. 

d. Required Use of Outcomes Data and 

Special Rule for NQTLs Related to 

Network Composition—26 CFR 

54.9812–1(c)(4)(iii), 29 CFR 

2590.712(c)(4)(iii), and 45 CFR 

146.136(c)(4)(iii) 

In the proposed rules, the 

Departments proposed to amend the 

2013 final regulations to add a 

requirement that, when designing and 

applying an NQTL, a plan or issuer 

must collect and evaluate relevant data 

in a manner reasonably designed to 

assess the impact of the NQTL on access 

to mental health and substance use 

disorder benefits and medical/surgical 

benefits, and consider the impact as part 

of the plan’s or issuer’s analysis of 

whether the NQTL, in operation, 

complies with the proposed no more 

restrictive requirement and the design 

and application requirements. The 

proposed rules included the general 

types of data that plans and issuers 

would have to collect and evaluate with 

regard to all NQTLs and additional data 

sets that would have to be collected and 

evaluated for NQTLs related to network 

composition standards. To the extent 

the relevant data collected and 

evaluated by the plan or issuer show 

material differences in access to mental 

health benefits and substance use 

disorder benefits as compared to 

medical/surgical benefits, under the 

proposed rules, the differences would 

be considered a strong indicator that the 

plan or issuer violated the proposed 

rules. In these instances, a plan or issuer 

would be required to take reasonable 

action to address any material 

differences in access as necessary to 

ensure compliance, in operation, with 

proposed 26 CFR 54.9812–1(c)(4)(i) and 

(ii), 29 CFR 2590.712(c)(4)(i) and (ii), 

and 45 CFR 146.136(c)(4)(i) and (ii), and 

would also be required to document the 

action that has been or is being taken by 

the plan or issuer to mitigate any 

material differences in access in the 

plan’s or issuer’s comparative analysis 

for the NQTL in that classification. 

Additionally, the Departments noted 

in the preamble to the proposed rules 

their concerns about standards related 

to network composition and other 

related NQTLs. Specifically, the 

Departments noted that network 

composition is the result of the design 

and application of myriad NQTLs and is 

informed by various processes, 

strategies, evidentiary standards, and 

other factors, many of which interact in 

complex ways. The Departments also 

expressed concern that NQTLs related 

to network composition inherently 

impact a participant’s or beneficiary’s 

access to mental health and substance 

use disorder benefits. Accordingly, the 

proposed rules included a special rule 

applicable to NQTLs related to network 

composition. Specifically, under the 

proposed rules, when designing and 

applying one or more NQTLs related to 

network composition standards, a plan 

or issuer would fail to meet the 

requirements of proposed 26 CFR 

54.9812–1(c)(4)(i) and (ii), 29 CFR 

2590.712(c)(4)(i) and (ii), and 45 CFR 

146.136(c)(4)(i) and (ii), in operation, if 

the relevant data show material 

differences in access to in-network 

mental health benefits and substance 

use disorder benefits as compared to innetwork medical/surgical benefits in a 

classification. 

The Departments also proposed that 

plans and issuers would not be required 

to comply with the relevant data 

evaluation requirements for NQTLs that 

impartially apply independent 

professional medical or clinical 

standards. However, proposed 26 CFR 

54.9812–1(c)(4)(iv)(D), 29 CFR 

2590.712(c)(4)(iv)(D), and 45 CFR 

146.136(c)(4)(iv)(D) did not provide a 

comparable exception for fraud, waste, 

and abuse measures, as the Departments 

stated these tools, while important, are 

more likely to result in NQTLs that 

improperly restrict access to mental 

health or substance use disorder 

benefits and therefore the impact of 

those NQTLs should be assessed. 

In General 

The Departments received many 

comments expressing general support 

for the proposal to require plans and 

issuers to collect and evaluate relevant 

data to assess an NQTL’s impact on 


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77610 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

75Code section 9812(a)(3)(A)(ii), ERISA section 

712(a)(3)(A)(ii), and PHS Act section 

2726(a)(3)(A)(ii). 

76 88 FR 51552, 51575. (Aug. 3, 2023). 

access to mental health and substance 

use disorder benefits and medical/ 

surgical benefits, including the 

proposed requirement related to data for 

network composition NQTLs. These 

commenters noted that the data 

collection and evaluation requirements 

would promote transparency and 

compliance with MHPAEA, stating that 

collecting and evaluating outcomes data 

is essential to assessing in-operation 

compliance and that plans and issuers 

had failed to conduct and share such 

analyses. Other commenters noted that 

collection and evaluation of data is 

critical to assessing an NQTL’s impact 

on access to mental health and 

substance use disorder benefits as 

compared to medical/surgical benefits, 

and by requiring plans and issuers to 

collect and assess outcomes data and to 

address material differences in access, 

the Departments are better aligning the 

focus of NQTL compliance with the 

fundamental purpose of MHPAEA. 

These commenters stated that, under the 

2013 final regulations, plans and issuers 

rarely appropriately measure and 

analyze an NQTL’s impact on access in 

the manner outlined in the proposed 

rules, and instead rely on processrelated rationales to justify disparate 

access to treatment for mental health 

conditions and substance use disorders 

as compared to access to treatment for 

medical conditions and surgical 

procedures. 

Other commenters stated that 

requiring plan sponsors to evaluate 

outcomes data to determine whether 

access to mental health and substance 

use disorder benefits is in parity with 

access to medical/surgical benefit is not 

supported by the statute and stated this 

provision of the proposed rules would 

be a significant departure from previous 

guidance under MHPAEA, under which 

the Departments stated that outcomes 

are not determinative of compliance. 

These commenters also stated that, 

because not all NQTLs are quantifiable, 

data metrics should not be required to 

determine parity, and disagreed with 

the Departments’ interpretation of the 

term ‘‘in operation’’ as the basis for the 

requirement that plans and issuers 

measure outcomes. The Departments 

also received many comments on the 

various components and specific 

comment solicitations related to the 

relevant data evaluation requirements in 

the proposed rules. 

The determination of whether an 

NQTL is ‘‘more restrictive,’’ within the 

meaning of the statute, as applied to 

mental health and substance use 

disorder benefits, cannot be divorced 

from the impact the NQTL has on access 

to these benefits. Accordingly, the 

Departments are finalizing the relevant 

data evaluation requirements, with 

some modifications based on the 

comments. These final rules require that 

plans and issuers be attentive to the 

impact of their NQTLs, in operation, by 

collecting and evaluating relevant data 

in a manner reasonably designed to 

assess the impact of the NQTL on 

relevant outcomes related to access, and 

carefully considering the impact as part 

of the plan’s or issuer’s evaluation. 

For this purpose, the term ‘‘relevant 

data’’ under these final rules is meant to 

be interpreted broadly but does not 

require a plan or issuer to collect and 

evaluate duplicative or overlapping data 

that reflect the same analysis. The 

obligation is to collect and evaluate 

relevant data in a manner reasonably 

designed to assess the impact of NQTLs. 

It is not a requirement to exhaustively 

survey all available data, nor a 

requirement that plans and issuers 

evaluate additional data that is 

duplicative or unlikely to change the 

determination of whether there is a 

material difference in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits. However, as discussed 

later in this preamble, a plan or issuer 

may be required to collect and evaluate 

more than one form of data to assess the 

aggregate impact of the NQTL (or 

NQTLs as related to network 

composition). For example, under these 

final rules, to assess the aggregate 

impact of NQTLs related to network 

composition, a plan or issuer could 

evaluate, as appropriate, in-network and 

out-of-network utilization rates 

(including data related to provider claim 

submissions), network adequacy metrics 

(including time and distance data, and 

data on providers accepting new 

patients), and provider reimbursement 

rates (for comparable services and as 

benchmarked to a reference standard). 

Further, a plan’s or issuer’s data 

collection and evaluation approach will 

not be considered to be conducted in a 

manner reasonably designed to assess 

the impact of an NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits if 

the plan or issuer does not consider data 

that it knows or reasonably should 

know suggest that the NQTL is 

associated with a material difference in 

access. The Departments expect that, in 

designing their data collection and 

evaluation approach, plans and issuers 

will consider outcomes data as 

necessary to assess the impact of the 

NQTL on access to mental health and 

substance use disorder benefits and 

medical/surgical benefits in the same 

classification. As explained later in this 

preamble, the plan’s or issuer’s 

evaluation of this data must be included 

as part of the comparative analysis of 

the NQTL. The Departments may 

require a plan or issuer to submit 

additional information to ensure that 

plans and issuers do not only collect 

and evaluate the impact of some 

relevant data, while disregarding other 

relevant data that is reasonably available 

and suggests the NQTL contributes to 

material differences in access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

The statutory language requires that a 

plan or issuer ensure that the treatment 

limitations (quantitative or 

nonquantitative) themselves that are 

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 (or 

coverage).75 The relevant data 

evaluation requirements at 26 CFR 

54.9812–1(c)(4)(iii), 29 CFR 

2590.712(c)(4)(iii), and 45 CFR 

146.136(c)(4)(iii) are intended to give 

particular meaning to the statutory 

language with respect to an NQTL itself, 

which, in these final rules, also requires 

compliance, in operation, with the 

design and application requirements 

under 26 CFR 54.9812–1(c)(4)(i), 29 CFR 

2590.712(c)(4)(i), and 45 CFR 

146.136(c)(4)(i). The Departments agree 

with commenters who noted that these 

requirements will promote transparency 

and compliance with MHPAEA, that 

such information is critical to assessing 

an NQTL’s compliance with the statute, 

and that requiring plans and issuers to 

collect and assess outcomes data and 

address material differences in access 

appropriately aligns the focus of NQTL 

compliance more closely with the 

fundamental purpose of MHPAEA. 

As stated in the preamble to the 

proposed rules, it is necessary to review 

and consider quantitative outcomes data 

to ascertain how the NQTL functions in 

the context of the plan’s or issuer’s 

administration and provision of 

benefits.76 Because the relevant data 

evaluation requirements in these final 

rules are meant to ensure and determine 

compliance, in operation, with the 

statutory language in Code section 

9812(a)(3)(A)(ii), ERISA section 

712(a)(3)(A)(ii), and PHS Act section 

2726(a)(3)(A)(ii), as noted earlier in this 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77611 

77Contemporaneously with the proposed rules, 

DOL, in collaboration with HHS and the Treasury, 

issued Technical Release 2023–01P, which set out 

principles and asked for public comment to inform 

future guidance with respect to data submissions 

for NQTLs related to network composition and a 

potential enforcement safe harbor. The comment 

period for the Technical Release closed on October 

2, 2023. Comments on the Technical Release are 

available on DOL’s website at https://www.dol.gov/ 

agencies/ebsa/laws-and-regulations/rules-andregulations/public-comments/tr-23-01. Those 

comments were solicited separately and are not 

addressed in these final rules. Plans and issuers 

would be allowed adequate time to conform to any 

future guidance on the type, form, and manner of 

collection and evaluation for the relevant data 

required under the final rules. 

78 45 CFR 144.103 states ‘‘[p]roduct’’ means ‘‘a 

discrete package of health insurance coverage 

benefits that are offered using a particular product 

network type (such as health maintenance 

organization, preferred provider organization, 

exclusive provider organization, point of service, or 

indemnity) within a service area’’ and ‘‘[p]lan’’ 

means, ‘‘with respect to a product, the pairing of the 

health insurance coverage benefits under the 

product with a particular cost-sharing structure, 

provider network, and service area.’’ 

preamble, plans and issuers must 

comply with both the design and 

application requirements and the 

relevant data evaluation requirements in 

these final rules to demonstrate 

compliance with MHPAEA. That is, if, 

with respect to an NQTL, a plan or 

issuer fails to comply with either set of 

requirements in 26 CFR 54.9812– 

1(c)(4)(i) or (iii), 29 CFR 

2590.712(c)(4)(i) or (iii), and 45 CFR 

146.136(c)(4)(i) or (iii), as applicable, 

the plan or issuer will be considered to 

violate MHPAEA and the relevant 

NQTL may not be imposed with respect 

to mental health or substance use 

disorder benefits in the classification 

unless and until the plan or issuer takes 

appropriate action to remedy the 

violation. 

Relevant Data 

The proposed rules identified types of 

relevant data that plans and issuers 

would be required to collect and 

evaluate for all NQTLs in each 

individual comparative analysis. Under 

the proposed rules, relevant data for all 

NQTLs would include, but would not be 

limited to, the number and percentage 

of claims denials and any other data 

relevant to the NQTL as required by 

State law or private accreditation 

standards. Additionally, relevant data 

for network composition NQTLs would 

include, but would not be limited to, innetwork and out-of-network utilization 

rates (including data related to provider 

claim submissions), network adequacy 

metrics (including time and distance 

data, and data on providers accepting 

new patients), and provider 

reimbursement rates (including as 

compared to billed charges). The 

proposed rules further provided that the 

Departments may specify the type, form, 

and manner for the relevant data 

evaluation requirements in future 

guidance.77

Many commenters supported the 

required use of data outcomes as 

proposed. Several commenters noted 

that many plans and issuers do not have 

access to the data they would need to 

comply with the relevant data 

evaluation requirements. Specifically, 

the Departments received several 

comments regarding limited access to 

data held by service providers, 

highlighting inconsistencies in service 

providers’ willingness or ability to 

provide data and the extensive systems 

changes and expenses necessary to 

allow data to be provided. Some 

commenters suggested that, because 

plan sponsors do not have access to 

complete and reliable sets of claims 

data, the final rules should specify that 

a plan or issuer can meet its obligations 

related to the relevant data evaluation 

requirements by requesting access to 

data, documenting such requests, and 

advising service providers that their 

refusal to provide data will be relayed 

to the Departments. 

Some commenters suggested the 

Departments issue the ‘‘type, form, and 

manner of collection and evaluation’’ 

for the relevant data evaluation 

requirements in guidance that can be 

periodically updated. Other commenters 

suggested that the final rules provide an 

exception from the relevant data 

evaluation requirements for NQTLs for 

which no such data are reasonably 

available, and that data evaluation be 

required only for outcomes that can be 

reasonably measured. One of these 

commenters highlighted that many 

NQTLs, including certain types of 

medical management techniques, 

assessments related to medical 

necessity, and exclusions for 

experimental/investigational treatments, 

are not generally associated with claims. 

Some commenters requested that the 

Departments provide an exhaustive list 

of a uniform set of outcomes data that 

plans and issuers are required to collect 

and assess as part of their comparative 

analysis with respect to an NQTL. 

Commenters suggested additional or 

different types of data that should be 

considered relevant data and that could 

be provided by plans and issuers, as 

well as their service providers, 

including the percentage of in-network 

claims covered vs. those submitted; time 

and distance data that includes virtual 

or telehealth visits; median in-network 

payments as compared to Medicare rates 

for inpatient benefits, office visits, and 

outpatient benefits; member satisfaction, 

as reported by standardized surveys 

such as the Consumer Assessment of 

Healthcare Providers and Systems 

program; and allowed amounts for 

certain specific Current Procedural 

Terminology (CPT) codes for various 

types of mental health and substance 

use disorder and medical/surgical 

providers. Many commenters suggested 

that relevant data include the number of 

authorizations issued for participants 

and beneficiaries for each of the levels 

(and sub-levels) of care described in the 

American Society for Addiction 

Medicine (ASAM) criteria and the agespecific Level of Care Utilization 

Services family of criteria. Some of 

these commenters also suggested 

outcomes data be reported separately for 

both mental health and substance use 

disorder services. Another commenter 

also suggested that relevant data include 

the number and percentage of drugs 

subject to prior authorization and step 

therapy (as an alternative to claims 

denials for the prescription drug 

classification), turnaround time for prior 

authorization, and inter-rater reliability. 

One commenter suggested using, as a 

parity indicator, a ratio of mental health 

utilization to primary care (for both 

initial and follow-up services) using 

data from the Medical Expenditure 

Panel Survey. Some commenters 

requested that, for fully insured 

coverage, the relevant data evaluation 

requirements apply at the issuer or 

‘‘product’’ level instead of the ‘‘plan’’ 

level (as those terms are defined in 45 

CFR 144.103),78 while others sought 

clarification regarding whether the data 

to be analyzed should be group-specific 

or aggregate-level, as well as any 

differences in the level of data needed 

for fully insured and self-funded plans. 

Some commenters objected to the 

proposal to require the collection and 

evaluation of out-of-network utilization 

data for NQTLs related to network 

composition, stating that high out-ofnetwork utilization of mental health and 

substance use disorder services alone 

does not necessarily indicate a network 

access deficiency and could instead be 

the product of other factors, such as a 

patient’s preference to use a particular 

provider. One commenter suggested 

requiring the collection and evaluation 

of provider-to-enrollee ratio data, and 

another commenter expressed support 

for requiring the collection and 

evaluation of data on whether innetwork providers are accepting new 

patients. Some commenters expressed 

support for the collection and 

evaluation of data on appointment wait 

times, time and distance data, types and 

numbers of mental health and substance 


khammond on DSKJM1Z7X2PROD with RULES2
77612 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

79As explained later in this preamble, these final 

rules provide additional provisions on how to 

comply with the relevant data evaluation 

requirements for an NQTL newly imposed by a plan 

or issuer or an NQTL where no data exist that can 

reasonably assess any relevant impact of the NQTL 

on access. The provisions of these final rules with 

respect to these types of NQTLs shall only apply in 

very limited circumstances. 

use disorder providers that are available 

in a network, and telehealth. Some 

commenters suggested collection and 

evaluation of provider reimbursement 

rates, stating that those rates have an 

impact on whether providers are able to 

join a network, how many patients they 

treat, and whether they can provide 

wages to attract and retain staff. Other 

commenters objected to the requirement 

to collect and evaluate provider 

reimbursement data, arguing that 

reimbursement rates are not equivalent 

data when comparing between medical/ 

surgical and mental health and 

substance use disorder benefits because 

of the nature of mental health and 

substance use disorder treatment and 

the associated time and cost. Other 

commenters objected to the inclusion of 

billed charges, arguing that these are 

arbitrary amounts not necessarily tied to 

any independent standard or benchmark 

of what is a reasonable charge and that 

Medicare rates should be used instead. 

After review of the comments, the 

Departments decline to provide a list of 

all relevant outcomes data required to 

be collected and evaluated by plans and 

issuers at this time; however, the 

Departments intend to issue in future 

guidance the type, form, and manner of 

collection and evaluation for the data 

required and the lists of examples of 

data that are relevant across the majority 

of NQTLs,79 as well as additional 

relevant data for NQTLs related to 

network composition. As part of this 

guidance, the Departments intend to 

update the MHPAEA Self-Compliance 

Tool to provide a robust framework and 

roadmap for plans and issuers to 

determine which data to collect and 

evaluate. 

While, as discussed earlier in this 

preamble, commenters provided various 

suggestions for relevant outcomes data 

to be collected and evaluated, many 

comments also suggested that what data 

are considered relevant depends on the 

nature of an NQTL. The Departments 

agree and intend to issue future 

guidance to help ensure that the data 

required to be collected and evaluated 

under the relevant data evaluation 

requirements of these final rules provide 

a meaningful representation of whether 

a plan or issuer is improperly applying 

an NQTL under MHPAEA. In 

developing this guidance, the 

Departments intend to take into 

consideration the feedback received 

regarding relevant data elements. 

Until additional guidance is provided, 

the Departments expect a plan or issuer 

with a typical plan or coverage design 

will collect and evaluate certain data 

that are likely to be relevant for the 

majority of NQTLs under the relevant 

data evaluation requirements. As the 

relevant data for any given NQTL will 

depend on the facts and circumstances 

of the NQTL at issue and the 

circumstances under which the NQTL 

was designed and applied, these final 

rules provide some flexibility for plans 

and issuers to determine what relevant 

data should be collected and evaluated, 

as appropriate. 

Under these final rules, relevant data 

for the majority of NQTLs could 

include, as appropriate, but are not 

limited to, the number and percentage 

of claims denials in a classification of 

benefits and any other data relevant to 

the NQTL required by State law or 

private accreditation standards. 

However, the Departments note that 

these final rules do not mandate that 

plans or issuers use private 

accreditation standards or evaluate data 

under State laws to which they are not 

subject. In addition, relevant data for a 

typical plan or coverage might include 

utilization data for mental health and 

substance use disorder services and 

medical/surgical services. For NQTLs 

such as prior authorization, relevant 

data could include rates of approvals 

and denials of prior authorization 

requests, rates of denials of post-service 

claims, application of penalties for a 

failure to obtain prior authorization, and 

turnaround times for prior authorization 

requests. Such information could be 

provided for benefits subject to prior 

authorization in each benefit 

classification in which the NQTL is 

imposed on mental health and 

substance use disorder benefits and 

medical/surgical benefits. All such 

examples of relevant data are nonexhaustive and whether any particular 

type of data is relevant for a plan or 

coverage is based on each plan’s or 

coverage’s unique design. 

Relevant data for NQTLs related to 

network composition standards could 

include, as appropriate, but are not 

limited to, in-network and out-ofnetwork utilization rates (including data 

related to provider claim submissions); 

network adequacy metrics (including 

time and distance data, and data on 

providers accepting new patients); and 

provider reimbursement rates (for 

comparable services and as 

benchmarked to a reference standard). 

The Departments modified this 

illustrative list of relevant data for 

NQTLs related to network composition 

by specifying that provider 

reimbursement rates should be analyzed 

for comparable services and as 

benchmarked to a reference standard, to 

better ensure that comparisons between 

access to mental health and substance 

use disorder benefits and medical/ 

surgical benefits will be informative. 

Thus, for example, the Departments 

expect a plan or issuer with a typical 

plan or coverage design could look at 

the ratio of inpatient, in-network and 

outpatient, in-network mental health 

and substance use disorder and 

medical/surgical claims, as compared to 

inpatient, out-of-network and 

outpatient, out-of-network mental 

health and substance use disorder and 

medical/surgical claims. Plans and 

issuers could also look at the number of 

providers (or facilities) within specified 

mental health and substance use 

disorder and medical/surgical provider 

categories (or categories of facilities) per 

1,000 participants and beneficiaries who 

have actively submitted claims within 

the past 6 months, which would reflect 

the experience of a plan’s or issuer’s 

participants and beneficiaries within a 

recent period of time, controlled for 

plan or issuer size. Additionally, a plan 

or issuer could look at the turnaround 

time for applications to be approved for 

a provider to join the plan’s or issuer’s 

network and the approval and denial 

rates for applications submitted by 

mental health and substance use 

disorder providers as compared to 

medical/surgical providers. The 

Departments recognize that providers 

may differ in education, training, and 

specialization, and the categories of 

mental health and substance use 

disorder and medical/surgical providers 

for which data is compared should take 

this into account. Additionally, relevant 

data could include the percentage of 

participants and beneficiaries who can 

access, within a specified time and 

distance by county-type designation, 

one (or more) in-network providers who 

are available to accept new patients for 

mental health and substance use 

disorder and medical/surgical provider 

categories. Relevant data for NQTLs 

related to network composition could 

also include median in-network 

reimbursement rates for services with 

the same CPT codes, as well as median 

in-network reimbursement rates for 

inpatient mental health and substance 

use disorder benefits and medical/ 

surgical benefits, as compared to 

Medicare rates; and median in-network 

reimbursement rates for outpatient 

mental health and substance use 


khammond on DSKJM1Z7X2PROD with RULES2
Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77613 

80See Code section 9812(a)(8)(B)(ii), ERISA 

sections 504 and 712(a)(8)(B)(ii), and PHS Act 

sections 2723 and 2726(a)(8)(B)(ii). 

81ERISA section 3(21)(A). See, e.g., Mertens v. 

Hewitt Assocs., 508 U.S. 248, 262 (1993) (stating 

that a fiduciary is defined ‘‘not in terms of formal 

trusteeship, but in functional terms of control and 

authority over the plan’’); Hamilton v. Allen– 

Bradley Co., Inc. 244 F.3d 819, 824 (11th Cir. 2001) 

(stating a person is a fiduciary ‘‘to the extent’’ that 

‘‘he has any discretionary authority or discretionary 

responsibility in the administration of such plan’’). 

disorder benefits, and medical/surgical 

benefits, as compared to Medicare rates. 

The Departments have the authority 

to request data—in addition to what a 

plan or issuer determines to be relevant 

data for any particular NQTL and 

includes in its comparative analyses—to 

sufficiently analyze the plan’s or 

issuer’s assertions, pursuant to the 

applicable enforcement statutes and as 

permitted by the amendments made by 

the CAA, 2021 to the Code, ERISA, and 

the PHS Act.80 Similarly, nothing in 

these final rules would prohibit an 

applicable State authority from 

requesting additional data with regard 

to an issuer’s comparative analysis. 

Accordingly, plans and issuers may be 

required to take reasonable action if the 

additional data requested by the 

Departments or an applicable State 

authority reveal material differences in 

access to mental health and substance 

use disorder benefits as compared to 

medical/surgical benefits. 

The Departments understand that 

many plans and issuers rely on TPAs 

and other service providers to 

administer a group health plan or health 

insurance coverage and acknowledge 

that several commenters highlighted the 

difficulty plans and issuers sometimes 

face obtaining the necessary information 

from their service providers to perform 

and document their comparative 

analyses. However, other commenters 

highlighted categories of data that TPAs 

and other service providers are able to 

provide for purposes of the relevant data 

evaluation requirements. Plans and 

issuers remain responsible for 

compliance with MHPAEA, and for 

ERISA-covered group health plans, 

fiduciaries, including TPAs or other 

service providers who are acting as 

fiduciaries, must work with plan 

sponsors and issuers to ensure that the 

plans and coverage they help establish 

and administer comply with the law. In 

the preamble to the proposed rules, the 

Departments highlighted that, under 

ERISA, TPAs may be fiduciaries with 

respect to private sector, employmentbased group health plans. To the extent 

these TPAs are fiduciaries for those 

plans, they are subject to the provisions 

governing fiduciary conduct and 

liability, including the provisions for cofiduciary liability under ERISA section 

405. The Departments also noted their 

commitment to using all available 

authority to ensure compliance by plans 

and issuers with MHPAEA and 

requested specific comments on how 

best to ensure all the entities involved 

in the design and administration of a 

group health plan’s benefits provide the 

necessary information to plans and 

issuers to support their efforts to comply 

with MHPAEA. 

Some commenters requested that the 

Departments require that plan sponsors 

include MHPAEA compliance 

provisions in their contracts with TPAs, 

likening such a requirement to actions 

taken by HHS to require that covered 

entities include provisions in their 

contracts with outside entities related to 

obligations under the Health Insurance 

Portability and Accountability Act 

(HIPAA) Privacy Rule. Others suggested 

focusing on compliance at the service 

provider level and working with 

Congress to obtain the ability to issue 

civil monetary penalties for violations of 

MHPAEA. 

The Departments decline to make any 

changes in these final rules to 

specifically address these issues after 

consideration of the suggestions 

contained in the comments. These 

proposals, including requiring the 

inclusion of contracting provisions 

similar to HIPAA ‘‘business associate 

agreements,’’ would go beyond the 

scope of this rulemaking. However, 

these types of contract provisions are a 

best practice that could be helpful to 

many plans and issuers in complying 

with their obligations to perform and 

document comparative analyses of 

NQTLs applied to mental health or 

substance use disorder benefits and 

medical/surgical benefits. 

Additionally, DOL also underscores 

its commitment to holding fiduciaries of 

ERISA-covered group health plans liable 

through existing means and working 

with all relevant entities, including 

service providers, to effectuate 

MHPAEA compliance. DOL remains 

committed to its current enforcement 

approach, which prioritizes potential 

violations that affect not just one plan 

or coverage, but hundreds or thousands 

of plans that provide coverage for 

thousands or millions of individuals. 

Where NQTL violations are identified in 

a plan or coverage, DOL generally 

examines the role that each of the plan’s 

or issuer’s service providers have in the 

design and administration of each 

NQTL to ascertain whether any of the 

service providers play a similar role 

serving other plans or issuers that might 

have the same violations, and seeks to 

bring them into compliance. Where 

necessary, DOL determines who is a 

fiduciary under ERISA and what 

additional enforcement actions are 

necessary. DOL notes that 

determinations of fiduciary liability are 

often based on the facts and 

circumstances specific to individual 

cases, but to the extent a TPA exercises 

discretionary authority or discretionary 

responsibility in the administration of 

an ERISA-covered health plan, DOL 

generally considers them to be 

fiduciaries.81

The Departments acknowledge both 

the challenges, cost, and complexity of 

collecting and evaluating data and the 

importance of data to measure the 

impact of an NQTL on access. The 

Departments also understand the 

importance of performing and 

documenting comparative analyses 

consistent with the statute. Therefore, 

these final rules provide additional 

provisions on how to comply with the 

relevant data evaluation requirements 

for an NQTL newly imposed by a plan 

or issuer or an NQTL where no data 

exist that can reasonably assess any 

relevant impact of the NQTL on access. 

A rule of construction at 26 CFR 

54.9812–1(c)(4)(iii)(A)(3)(iii), 29 CFR 

2590.712(c)(4)(iii)(A)(3)(iii), and 45 CFR 

146.136(c)(4)(iii)(A)(3)(iii) in these final 

rules explains that the provisions of 

these final rules with respect to these 

types of NQTLs shall only apply in very 

limited circumstances and, where 

applicable, shall be construed narrowly, 

consistent with the fundamental 

purpose of MHPAEA. The Departments 

are of the view that relevant data can be 

collected and evaluated for nearly all 

NQTLs, and note that, when designing 

a new NQTL, or making changes to an 

existing NQTL, plans and issuers must 

consider what data is relevant and how 

it will be collected and evaluated. 

The Departments recognize that there 

may be a lag between when an NQTL is 

newly designed and applied and when 

relevant data are available if there are no 

data available initially to assess the 

NQTL’s impact on access to mental 

health and substance use disorder 

benefits and medical/surgical benefits. 

Under these final rules, if a plan or 

issuer newly imposes an NQTL 

(including because the plan or coverage 

itself is newly offered) for which data 

are initially and temporarily 

unavailable, and the plan or issuer 

therefore cannot comply with the 

relevant data evaluation requirements 

for the NQTL, a plan or issuer must 

include in its comparative analysis a 

detailed explanation of the lack of 

relevant data, the basis for the plan’s or 


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issuer’s conclusion that there is a lack 

of relevant data, and when and how the 

data will become available and be 

collected and analyzed. Additionally, 

the plan or issuer must comply with the 

relevant data evaluation requirements as 

soon as practicable once relevant data 

becomes available. These additional 

provisions are intended to be applicable 

only in very limited circumstances 

where a plan or issuer newly imposes 

an NQTL for which no relevant data is 

available for a limited time after it is 

first imposed, and will not be available 

for a new NQTL where data is available 

but not evaluated due to lack of 

collection. The Departments note that a 

change in an NQTL’s design or 

application is generally not considered 

a new NQTL for which there is no data 

initially available. In the very limited 

situations where a data lag exists for a 

new NQTL, the Departments expect a 

plan or issuer to comply with the 

relevant data evaluation requirements 

and include data in its comparative 

analyses within a limited amount of 

time (as soon as practicable, but no later 

than the end of the second plan year 

that follows the imposition of a new 

NQTL). 

These final rules also acknowledge 

that some limited circumstances may 

exist in which no data exists that can 

reasonably assess any relevant impact of 

an NQTL on access to mental health and 

substance use disorder benefits as 

compared to medical/surgical benefits. 

Such NQTLs might include, in certain 

circumstances, for example, some 

exclusions based on whether a 

treatment is experimental or 

investigative. As commenters have 

highlighted, these NQTLs are not 

generally attached to claims, so plans 

and issuers may not have reliable data 

on the impact of these excluded services 

with respect to participants and 

beneficiaries. In the limited 

circumstances where no relevant data 

exist relating to an NQTL, these final 

rules require the plan or issuer to 

include in its comparative analysis a 

reasoned justification as to the basis for 

its conclusion that there are no data that 

can reasonably assess the NQTL’s 

impact, why the nature of the NQTL 

prevents the plan or issuer from 

reasonably measuring its impact, an 

explanation of what data was 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

that the NQTL complies with MHPAEA. 

A plan or issuer also must comply with 

the relevant data evaluation 

requirements as soon as practicable if 

the plan or issuer becomes aware (or 

reasonably should become aware) of 

data that can reasonably assess any 

relevant impact of the NQTL. 

The Departments also note that the 

unavailability of data for purposes of the 

relevant data evaluation requirements of 

these final rules does not affect the 

plan’s or issuer’s obligation to comply 

with the design and application 

requirements. 

Material Differences in Access 

Under the proposed rules, to the 

extent the relevant data evaluated show 

material differences in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits, the differences would 

be considered a strong indicator that the 

plan or issuer has violated the proposed 

no more restrictive requirements or the 

design and application requirements. In 

such instances, the proposed rules 

would require plans and issuers to take 

reasonable action to address the 

material differences in access as 

necessary to ensure compliance, in 

operation, with the proposed no more 

restrictive requirement and design and 

application requirements, and 

document the action that has been or is 

being taken by the plan or issuer to 

address any material differences in 

access to mental health and substance 

use disorder benefits as compared to 

medical/surgical benefits. The 

Departments stated in the preamble to 

the proposed rules that material 

differences alone would not 

automatically result in a finding of 

noncompliance, except where related to 

network composition, as discussed in 

more detail later in this preamble. 

Some commenters supported the 

proposal that material differences in 

access would constitute a strong 

indicator of noncompliance, stating that 

such approach is a reasonable method to 

identify potential instances of 

noncompliance while allowing for 

instances where disparities in access are 

due to factors beyond the plan’s or 

issuer’s control. Several commenters 

opposed the proposal that material 

differences would constitute a strong 

indicator of noncompliance, stating that 

this would be inconsistent with the 

Departments’ previous statements in the 

2020 MHPAEA Self-Compliance Tool 

that negative outcomes data is a red flag, 

but not determinative of compliance. 

One commenter stressed that it was 

important to provide clarity on how the 

Departments would impose this 

standard. 

Several commenters requested that 

the Departments define the term 

‘‘material differences,’’ and many 

commenters provided suggested 

meanings for the term. A number of 

commenters requested that the term be 

defined as a serious or significant 

variation, or one that would have a 

major effect on access to care. One 

commenter suggested that the definition 

of material differences should set a high 

standard to identify clear outliers and 

major differences in access rather than 

moderate variations. Some commenters 

stated that any definition of material 

differences in access should be based 

only on statistical significance. One 

commenter suggested a 10-percent 

difference as the definition of a material 

difference. Other commenters requested 

that the Departments adopt a ‘‘de 

minimis’’ standard, rather than a 

material differences in access standard. 

Additionally, some commenters 

suggested that material differences in 

access should mean that a substantial 

number of members could not access 

mental health and substance use 

disorder benefits. Several other 

commenters suggested that material 

differences be defined to allow an 

acceptable level of difference in access 

to mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits, accounting 

for participant behavior as a driver of 

accessibility, with consideration of data 

credibility and the amount of available 

data. Another commenter highlighted 

that relevant factors should include the 

size of the data pool, variability over 

time, availability of complementary 

measures, and the degree of control. 

Some commenters suggested that 

differences in data outcomes might 

result from a wide variety of reasons 

that do not indicate noncompliance, 

including random variability, provider 

or member behavior, changes to 

unrelated Federal or State laws, or other 

factors that are outside of the plan’s or 

issuer’s control. One commenter 

requested that plans and issuers be 

permitted to take into account relevant 

context (for example, there are many 

more drugs that are considered medical/ 

surgical benefits than mental health and 

substance use disorder benefits, so the 

percentage of mental health and 

substance use disorder drugs to which 

NQTLs apply may be higher). 

The Departments are finalizing 

language specifying that, to the extent 

the relevant data evaluated suggest that 

the NQTL contributes to material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits 

in a classification, such differences will 

be considered a strong indicator that the 

plan or issuer is in violation of 

MHPAEA. The material differences 

standard reflects an interpretation of the 


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82 78 FR 68240, 68245 (Nov. 13, 2013). 

83Final FAQs About Mental Health and 

Substance Use Disorder Parity Implementation and 

the 21st Century Cures Act Part 39, Q 7 (Sept. 5, 

2019), https://www.dol.gov/sites/dolgov/files/EBSA/ 

about-ebsa/our-activities/resource-center/faqs/acapart-39-final.pdf and https://www.hhs.gov/ 

guidance/document/affordable-care-actimplementation-faqs-final-set-39 (FAQs Part 39); 

EBSA, Self-Compliance Tool for the Mental Health 

Parity and Addiction Equity Act (MHPAEA) (2020), 

pg. 27, https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/laws/mental-healthparity/self-compliance-tool.pdf. 

84The considerations outlined in these final rules 

refer to differences in access to mental health or 

substance use disorder benefits attributable to 

generally recognized independent professional 

medical or clinical standards or carefully 

circumscribed measures reasonably and 

appropriately designed to detect or prevent and 

prove fraud and abuse that minimize the negative 

impact on access to appropriate mental health and 

substance use disorder benefits. See 26 CFR 

54.9812–1(c)(4)(iii)(B)(2)(ii), 29 CFR 

2590.712(c)(4)(iii)(B)(2)(ii), and 45 CFR 

146.136(c)(4)(iii)(B)(2)(ii). Differences solely 

attributable to such standards or measures are not 

treated as material differences for purposes of these 

final rules. 

statutory terms ‘‘substantially all’’ and 

‘‘predominant’’ in a manner that takes 

into account the multifaceted nature of 

NQTLs, as well as the complexity of 

analyzing such NQTLs. The material 

differences standard is intended to set 

forth a principle-based approach to 

determining whether relevant data 

suggest that an NQTL applied to mental 

health or substance use disorder 

benefits is more restrictive than the 

predominant NQTL applied to 

substantially all medical/surgical 

benefits in a classification. The standard 

also allows plans and issuers, when 

applying an outcomes-based analysis, 

the flexibility to assess comparability in 

a way that can be tailored to a variety 

of different types of NQTLs, and to 

account for outliers or claims 

experience that may not be reflective of 

a difference in access resulting from the 

NQTL itself. 

The Departments emphasize that the 

material differences standard works 

together with the other requirements 

contained in these final rules. A plan or 

issuer cannot determine whether an 

NQTL applied to mental health or 

substance use disorder benefits is more 

restrictive than the predominant NQTL 

applied to substantially all medical/ 

surgical benefits without evaluating the 

effect of imposing the NQTL on access 

to mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits. Additionally, 

when the plan or issuer knows or 

should know that one or more of its 

NQTLs is contributing to material 

differences in access, it cannot simply 

disregard or avoid ascertaining that 

information, and continue its current 

practices, but instead must act 

consistent with its obligation to ensure 

that NQTLs applied to mental health 

and substance use disorder benefits 

generally are no more restrictive than 

those applied to medical/surgical 

benefits. 

While the preamble to the 2013 final 

regulations stated that ‘‘[d]isparate 

results alone do not mean that the 

NQTLs in use do not comply with these 

requirements,’’ 82 the Departments have 

consistently stressed in subregulatory 

guidance that disparate results are a red 

flag or a warning sign of 

noncompliance, including in the 2020 

MHPAEA Self-Compliance Tool, which 

states that ‘‘. . . while outcomes are not 

determinative of a MHPAEA violation, 

they can often serve as red flags or 

warning signs to alert the plan or issuer 

that a particular provision may warrant 

further review.’’ 83 The experience of the 

Departments in enforcing MHPAEA, 

moreover, has shown that plans and 

issuers are commonly unprepared to 

explain material differences in 

outcomes data, and in some cases, have 

mistakenly considered the 2013 final 

regulations as granting freedom to 

ignore potentially problematic or 

significant differences, even where such 

differences appear to have a direct 

causal link to the plan’s practices and 

limitations. 

These final rules, as discussed later in 

this preamble, make clear that plans and 

issuers must consider whether such 

material differences exist, and whether 

the differences are attributable to the 

NQTL. In instances where the relevant 

data suggest that the NQTL contributes 

to material differences, these final rules 

require plans and issuers to take 

reasonable action, as necessary, to 

address the material differences and to 

document that such action has or will 

be taken to ensure compliance, in 

operation, with the requirements for 

NQTLs under these final rules. 

This increased emphasis on outcomes 

data and the material differences 

standard will help ensure that more 

restrictive NQTLs are not imposed on 

mental health and substance use 

disorder benefits as compared to the 

predominant NQTLs applied to 

substantially all medical/surgical 

benefits in the same classification by 

identifying when an NQTL results in 

differences in access that are likely to 

have a negative impact on access to 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. This standard 

generally would not include a de 

minimis difference in access or a 

difference driven by an outlier, such as 

a single plan participant’s claims 

experience or a single claim. The 

Departments also note that the existence 

of material differences in access do not 

automatically result in a finding of 

noncompliance, and that plans and 

issuers will continue to have the 

opportunity provide additional 

information as part of the NQTL 

comparative analysis process, as well as 

to respond to the Departments in any 

enforcement actions, by submitting 

additional data, the sources of the data, 

explanatory material, related 

documents, evidence of reasonable 

actions that have been or are being taken 

by the plan or issuer to address such 

differences, and other material and 

information to demonstrate compliance 

with MHPAEA. 

The Departments acknowledge 

comments from plans and issuers asking 

for guidance on how to determine 

whether a difference is material for 

purposes of the relevant data evaluation 

requirements, as well as those asking for 

a principle-based approach rather than 

specific thresholds for each outcome 

measure, because what is material will 

likely vary by NQTL, market, plan, and 

benefit classification for each item or 

service, as well as the number of 

participants and beneficiaries affected. 

In these final rules, the Departments set 

forth a standard that takes into account 

the range of commenters’ suggestions 

and incorporates them into a single 

standard, while helping to ensure that 

participants’ and beneficiaries’ access to 

mental health and substance use 

disorder benefits is in parity with their 

access to medical/surgical benefits. 

Specifically, under these final rules, 

relevant data are considered to suggest 

that the NQTL contributes to material 

differences in access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

if, based on all relevant facts and 

circumstances, and taking into account 

specific considerations,84 the difference 

in the data suggests that the NQTL is 

likely to have a negative impact on 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. For this 

purpose, these final rules specify that 

relevant facts and circumstances may 

include, but are not limited to, the terms 

of the NQTL at issue, the quality or 

limitations of the data, causal 

explanations and analyses, evidence as 

to the recurring or non-recurring nature 

of the results, and the magnitude of any 

disparities. The Departments note that 

plans and issuers may consider other 


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85The Departments also recognize that smaller 

plans may have limited relevant data to evaluate, 

which could result in the plan not having sufficient 

data to identify statistically significant differences 

in the data. The Departments note that, because 

these final rules do not require that a difference be 

statistically significant to constitute a material 

difference, small sample size does not amount to 

circumstances under which the provisions in 26 

CFR 54.9812–1(c)(4)(iii)(A)(3), 29 CFR 

2590.712(c)(4)(iii)(A)(3), and 45 CFR 

146.136(c)(4)(iii)(A)(3) would apply. 

relevant facts and circumstances that are 

not specifically listed in these final 

rules, as appropriate, and that 

differences in access to mental health or 

substance use disorder benefits 

attributable to independent professional 

medical or clinical standards or fraud 

and abuse measures are not considered 

to be material, as discussed later in this 

preamble. 

The Departments are of the view that 

the quality or limitations of the relevant 

data are a key consideration in 

determining whether a difference in the 

data suggests that an NQTL contributes 

to a material difference in access to 

mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits. As discussed 

earlier in this preamble, the 

Departments acknowledge the difficulty 

some plans and issuers may face in 

obtaining the necessary information, 

including data, from their service 

providers to perform and document 

their comparative analyses. The 

Departments are also aware that plans 

and issuers might not have direct 

control over the quality of the data they 

receive from a service provider. Despite 

this, the Departments do not intend for 

this consideration to create a loophole 

that allows plans and issuers to avoid 

determining materiality when 

evaluating differences in relevant data. 

Rather, the Departments expect plans 

and issuers to consider the quality and 

limitations of any available relevant 

data as just one of multiple potential 

facts and circumstances when assessing 

the impact of an NQTL on access to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits. 

When considering causal 

explanations and analyses in 

determining whether a difference in the 

data suggests that an NQTL contributes 

to a material difference in access, plans 

and issuers should consider whether 

they are attributable to the NQTL, 

instead of being attributable to other 

factors or considerations. As discussed 

in more detail later in this preamble, a 

plan’s or issuer’s comparative analysis 

for an NQTL applicable to mental health 

and substance use disorder benefits and 

medical/surgical benefits must include a 

discussion of the actions that have been 

or are being taken by the plan or issuer 

to address any material differences in 

access. This discussion must include, as 

applicable, a reasoned explanation of 

any considerations beyond a plan’s or 

issuer’s control that contribute to the 

existence of material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, including 

those that result in the persistence of 

such material differences despite 

reasonable actions that have been or are 

being taken to address such differences 

by the plan or issuer. 

For example, if a plan or issuer 

identifies, based on reliably established 

indicia of fraud and abuse, that a 

particular provider or facility has 

submitted fraudulent claims for mental 

health or substance use disorder 

benefits, resulting in a higher percentage 

of denials of claims for mental health or 

substance use disorder benefits than for 

medical/surgical benefits in the same 

classification, the evidence of fraud and 

abuse could be considered part of the 

relevant facts and circumstances for 

purposes of determining whether a 

material difference in access exists. 

Further, if a material difference in 

access exists, the evidence of fraud and 

abuse could also be considered part of 

the relevant facts and circumstances for 

purposes of determining whether the 

difference is attributable to the NQTL. 

In such a case, the plan or issuer might 

reasonably conclude that the difference 

in outcomes is attributable to higher 

underlying levels of fraud for mental 

health and substance use disorder 

benefits than for medical/surgical 

benefits in the same classification (with 

the commission of the fraud being a 

circumstance that is beyond the plan’s 

or issuer’s control), rather than the 

application of a more restrictive NQTL 

to mental health or substance use 

disorder benefits. As explained later in 

this preamble, under these final rules, 

the plan or issuer must include in its 

comparative analysis a reasoned 

explanation of the reliably established 

indicia of fraud and abuse beyond the 

plan’s or issuer’s control that contribute 

to the existence of material differences 

in access to mental health or substance 

use disorder benefits as compared to 

medical/surgical benefits. 

The Departments note that a 

difference in access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

that is driven by an outlier, such as a 

single plan participant’s claims 

experience or a single claim, will 

generally not be considered material for 

this purpose because the nature of the 

results of the evaluation of relevant data 

would not be considered recurring. 

Therefore, such a difference would not 

trigger the requirement to take 

reasonable action, as necessary, under 

these final rules. 

In the preamble to the proposed rules, 

the Departments solicited comments on 

whether materiality should be defined 

in terms of the results of statistical 

testing and requested feedback from 

interested parties on the optimal 

method for assembling data and 

statistical analysis. As highlighted 

earlier in this preamble, commenters 

requested that the definition of material 

differences account for statistically 

significant differences, and take into 

account the amount of available data, 

while also excluding differences related 

to random variability. The Departments 

are of the view that plans and issuers 

can explain in their comparative 

analyses whether differences are or are 

not statistically significant and why, 

based on the relevant facts and 

circumstances, such differences are 

determined to be or not to be material. 

However, the Departments also 

recognize that statistical significance 

might not always be appropriate to 

consider, and that there would be 

challenges with requiring plans and 

issuers to use a statistical analysis in 

determining whether material 

differences in access exist for all 

NQTLs, as well as whether and how 

those differences are attributable to the 

NQTL or NQTLs in question.85

Plans and issuers should carefully 

consider the magnitude of any negative 

impact on access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

and whether the relevant data therefore 

suggest an NQTL contributes to a 

material difference in access that might 

require the plan or issuer to take 

reasonable action, as necessary, to 

ensure compliance, in operation, with 

the requirements for NQTLs under these 

final rules. As noted earlier in this 

preamble, a difference in access to 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits that is de minimis will 

not be considered material for purposes 

of the relevant data evaluation 

requirements. The size of any negative 

impact on access, even if small, is part 

of the relevant facts and circumstances 

that could determine whether a 

disparity in access is material. These 

final rules do not require a plan or 

issuer to obtain a statistical, actuarial, or 

other equivalent opinion to support a 

conclusion as to whether a difference in 

access demonstrated by relevant data is 

material, based on the relevant facts and 


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circumstances. However, a plan or 

issuer may obtain such an opinion, and 

if relying on it as part of performing its 

comparative analysis, the plan or issuer 

should document the relevance of that 

opinion to the conclusion that a 

difference in data suggests or does not 

suggest material difference in access, as 

part of the comparative analysis. For 

plans and issuers that do use such an 

opinion to support a conclusion as to 

the materiality of differences in access, 

the Departments would expect these 

opinions or determinations to be made 

by a qualified and, if applicable, 

licensed or otherwise accredited 

individual or organization. 

Additionally, the individual’s or 

organization’s qualifications must be 

documented as part of the comparative 

analysis, along with a description of the 

extent to which the plan or issuer 

ultimately relied upon the individual’s 

or organization’s evaluation in 

performing and documenting the 

comparative analysis of the design and 

application of the NQTL, as discussed 

in more detail later in this preamble. 

The Departments note that a statistical, 

actuarial, or other equivalent opinion 

obtained by a plan or issuer to support 

a conclusion as to whether a difference 

in access based on relevant data is or is 

not material is not dispositive simply 

because it is made by a qualified, 

licensed or otherwise accredited 

individual or organization. In the course 

of enforcement, the Departments and 

applicable State authorities may review 

and assess the validity of the assertions, 

and the factors upon which such 

assertions are based, contained in such 

an opinion, as well as a plan’s or 

issuer’s determination as to whether any 

particular difference in access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits is or is not material. 

In these final rules, the Departments 

decline to finalize the proposed 

exception to the relevant data 

evaluation requirements for 

independent professional medical or 

clinical standards, as discussed later in 

this preamble. The Departments are of 

the view that plans and issuers that 

impose NQTLs that utilize such 

standards as the basis for, or as, factors 

or evidentiary standards, should collect 

and evaluate relevant data, to determine 

the impact of NQTLs developed or 

applied using these standards on access 

to mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits. However, 

reliance on such standards can improve 

care and health outcomes for 

participants and beneficiaries. The 

Departments also recognize that clinical 

differences between mental health 

conditions, substance use disorders, 

medical conditions, and surgical 

procedures may sometimes drive 

apparent differences in data outcomes, 

even where plans and issuers rely on 

independent professional medical or 

clinical standards. Therefore, under 

these final rules, differences in access to 

mental health or substance use disorder 

benefits attributable to generally 

recognized independent professional 

medical or clinical standards that are 

used as the basis for a factor or 

evidentiary standard used to design or 

apply an NQTL are not considered to be 

material. To the extent a plan or issuer 

attributes any differences in access to 

the application of such standards, the 

plan or issuer must explain its bases for 

that conclusion in the plan’s or issuer’s 

comparative analysis, as discussed later 

in this preamble. 

The Departments did not propose that 

NQTLs related to fraud, waste, and 

abuse measures would be excepted from 

the relevant data evaluation 

requirements. However, as discussed 

earlier in this preamble, reliably 

established indicia of fraud and abuse 

could, if appropriate, be considered 

relevant facts and circumstances taken 

into account by a plan or issuer when 

determining whether a difference in 

access is material. Indicia of fraud and 

abuse could also be relevant in 

determining whether a material 

difference in access is attributable to an 

NQTL or, instead, is attributable to the 

use of fraud and abuse measures. 

Therefore, under these final rules, a 

difference in access to mental health or 

substance use disorder benefits 

attributable to carefully circumscribed 

measures reasonably and appropriately 

designed to detect or prevent and prove 

fraud and abuse that minimize the 

negative impact on access to appropriate 

mental health and substance use 

disorder benefits are not considered to 

be material. As discussed later in this 

preamble, in such a case, a plan’s or 

issuer’s comparative analysis must 

provide a thorough and reasoned 

explanation that indicia for fraud and 

abuse have been reliably established 

through objective and unbiased data, 

and that such measures are narrowly 

designed to minimize the negative 

impact on access to appropriate mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits in the same 

classification. 

Reasonable Action, as Necessary, To 

Address Material Differences in Access 

The proposed rules provided that a 

plan or issuer would be required to take 

reasonable action to address any 

material differences in access as 

necessary to ensure compliance, in 

operation, with the proposed no more 

restrictive requirement and design and 

application requirements. The preamble 

to the proposed rules noted that 

whether any particular action would be 

considered reasonable in response to 

any material differences in access 

resulting from an evaluation of 

outcomes data would be determined 

based on the relevant facts and 

circumstances, including the NQTL 

itself, the relevant data, the extent of the 

material differences in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits, and the impact of the 

material differences in access on 

participants and beneficiaries. The 

Departments proposed that, in addition 

to taking reasonable action to address 

material differences, a plan or issuer 

would also be required to document in 

its comparative analyses any such 

action that has been or is being taken by 

the plan or issuer to mitigate any 

material differences in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits. The Departments 

noted in the preamble to the proposed 

rules that plans and issuers could use 

this documentation to explain why 

material differences demonstrated by 

the relevant outcomes data should not 

be considered a violation of the rules for 

NQTLs (other than NQTLs related to 

network composition) and solicited 

comments on what additional 

information is necessary to clarify what 

would constitute reasonable action in 

response to relevant data that reveal 

material differences in access. 

Several commenters supported the 

requirement to take reasonable action in 

response to relevant data that reveals 

material differences in access. Some 

commenters suggested that ‘‘reasonable 

action’’ should be defined and should 

mean actions, including, but not limited 

to, internal reforms and modifications or 

elimination of the NQTL to resolve the 

material differences. One commenter 

stated that requiring reasonable action 

where there is no violation of the law 

and without an opportunity to explain 

why material differences in access may 

not in fact be a violation of MHPAEA is 

arbitrary and capricious and goes 

beyond the authority of the 

Departments. Therefore, the commenter 

noted reasonable action should be 


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86Code section 9812(a)(3)(A), ERISA section 

712(a)(3)(A), and PHS Act section 2726(a)(3)(A). 

required only after an opportunity to 

rebut a presumption of noncompliance. 

Under these final rules, when a plan 

or issuer knows or reasonably should 

know that NQTLs may be contributing 

to material differences in access, it must 

take reasonable action, as necessary, to 

ensure compliance, in operation, with 

the requirements for NQTLs under these 

final rules. The standard is not focused 

on inconsequential differences, but 

rather only on those that are material, 

meaning those that are likely to have a 

negative impact on access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. If a plan or issuer is 

aware of information that suggests a 

potential violation of MHPAEA, the 

statute requires the plan or issuer to 

address such potential violations as 

necessary to satisfy its obligation to 

ensure that the NQTLs comply with the 

substantive requirements of the 

statute,86 and to be able to continue to 

impose the NQTL. The requirement to 

take reasonable action, as necessary, 

where material differences in access 

exist is consistent with the statutory 

requirement that plans and issuers 

ensure that treatment limitations 

(including NQTLs) applicable to mental 

health or substance use disorder 

benefits are no more restrictive than the 

predominant treatment limitations 

applied to substantially all medical/ 

surgical benefits. If the relevant data 

suggest that an NQTL contributes to 

material differences in access, a plan or 

issuer generally is not able to ensure 

compliance with MHPAEA, in 

operation, unless the plan or issuer 

takes action that is reasonably designed 

to try to close the gap and address those 

differences. 

The proposed rules would have 

required plans and issuers to take 

reasonable action to address material 

differences in access as necessary to 

ensure compliance, in operation, with 

the proposed no more restrictive 

requirement and design and application 

requirements. However, as discussed 

earlier in this preamble, these final rules 

do not retain the proposed mathematical 

substantially all and predominant tests 

and instead retain language that 

incorporates the statutory requirements 

of Code section 9812(a)(3)(A), ERISA 

section 712(a)(3)(A), and PHS Act 

section 2726(a)(3)(A), as the general rule 

for NQTLs. Therefore, these final rules 

make technical changes to replace the 

cross-references in the material 

differences standard to the proposed no 

more restrictive requirement and design 

and application requirements, and 

replace them with a cross-reference to 

the general rule for NQTLs. 

The Departments acknowledge 

commenters’ requests for guidance on 

what constitutes reasonable action for 

this purpose. The Departments 

anticipate that, in many cases, the 

reasonable actions that plans and 

issuers might take, as necessary, to 

address material differences in access 

will be similar to actions they might 

have taken independent of the 

requirements contained in these final 

rules. For example, some plans and 

issuers may already take certain action 

in response to changes in demand for 

services, needs of patients, or requests 

from plan sponsors, which could be 

considered reasonable action for this 

purpose, depending on the relevant 

facts and circumstances. Commenters 

highlighted that, since the enactment of 

MHPAEA, plans and issuers have 

increased spending and raised 

reimbursement rates for mental health 

and substance use disorder services, and 

invested in programs to help members 

identify mental health and substance 

use disorder care needs and to connect 

them to the appropriate services as early 

as possible. Commenters also 

highlighted that plans and issuers have 

also developed mental health 

assessment screening tools for youth 

populations to detect those at risk. 

Depending on the facts and 

circumstances, all of these actions could 

be examples of reasonable actions that 

plans and issuers can take, as necessary, 

where the relevant data suggest that an 

NQTL contributes to material 

differences, as required under these 

final rules. However, plans and issuers 

will ultimately be responsible for 

assessing the nature of a material 

difference in access to determine what 

reasonable action should be taken, as 

necessary, to address those differences. 

In addition, a plan or issuer must 

document the actions that have been or 

are being taken in the plan’s or issuer’s 

comparative analysis and include a 

reasoned explanation of any material 

differences in access that persist despite 

reasonable actions that have been or are 

being taken. For a plan or issuer 

designing and applying one or more 

NQTLs related to network composition 

standards, the comparative analysis 

must include a discussion of the actions 

that have been or are being taken to 

address material differences in access to 

in-network mental health and substance 

use disorder benefits as compared to innetwork medical/surgical benefits. 

Special Rule for NQTLs Related to 

Network Composition 

In the preamble to the proposed rules, 

the Departments noted a growing 

disparity between in-network 

reimbursement rates for mental health 

and substance use disorder providers 

and medical/surgical providers, as well 

a significant disparity between how 

often participants and beneficiaries have 

little or no choice under their plan or 

coverage but to utilize out-of-network 

mental health and substance use 

disorder providers and facilities, as 

compared to medical/surgical providers 

and facilities. The Departments also 

expressed their specific concerns about 

standards related to network 

composition and other related NQTLs, 

because these standards are critical to 

ensuring parity in access to mental 

health and substance use disorder 

benefits for participants and 

beneficiaries. Therefore, the 

Departments included in the proposed 

rules a requirement that, in addition to 

the relevant data required for all NQTLs, 

plans and issuers would also be 

required to collect and evaluate relevant 

data for NQTLs related to network 

composition. For this purpose, the 

proposed rules stated that network 

composition NQTLs include, but are not 

limited to, standards for provider and 

facility admission to participate in a 

network or for continued network 

participation, including methods for 

determining reimbursement rates; 

credentialing standards; and procedures 

for ensuring the network includes an 

adequate number of each category of 

provider and facility to provide services 

under the plan or coverage. Under the 

proposed special rule, when designing 

and applying one or more NQTLs 

related to network composition 

standards, a plan or issuer would fail to 

meet the requirements of the proposed 

no more restrictive requirement and 

design and application requirements, in 

operation, if the relevant data show 

material differences in access to innetwork mental health or substance use 

disorder benefits as compared to innetwork medical/surgical benefits in a 

classification. This standard proposed to 

set a higher bar for NQTLs related to 

network composition than for other 

NQTLs by treating material differences 

in access to in-network mental health or 

substance use disorder benefits as 

compared to in-network medical/ 

surgical benefits as a failure to meet the 

requirements of MHPAEA, instead of as 

a strong indicator of a violation of 

MHPAEA. 

The Departments proposed that plans 

and issuers be required to take action to 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77619 

address material differences in access 

for NQTLs related to network 

composition or no longer impose the 

relevant NQTLs to avoid a violation of 

MHPAEA. Examples of such actions 

listed by the Departments in the 

preamble to the proposed rules for 

NQTLs related to network composition 

include ensuring that plans and issuers 

or their service providers (as applicable) 

make special efforts to contract with a 

broad range of mental health and 

substance use disorder providers who 

are available, including authorizing 

greater compensation or other 

inducements to the extent necessary; 

expanding telehealth arrangements as 

appropriate to manage regional 

shortages; notifying participants and 

beneficiaries in clear and prominent 

language on the plan’s or issuer’s 

website, employee brochures, and the 

summary plan description of a toll-free 

number for help finding in-network 

providers; ensuring that the plan’s or 

issuer’s service providers (as applicable) 

reach out to the treating professionals 

and facilities to see if they will enroll in 

the network; and ensuring the network 

directories are accurate and reliable. 

The Departments also recognized that 

shortages of mental health and 

substance use disorder providers could 

pose challenges to issuers, plans, and 

their service providers. The preamble to 

the proposed rules noted that, if, despite 

taking appropriate action, relevant data 

collected and evaluated for NQTLs 

related to network composition 

continue to reveal material differences 

due to, for example, provider shortages 

that the plan or issuer cannot effectively 

address through no fault of its own, the 

Departments would not cite such a plan 

or issuer for failure to comply with the 

proposed relevant data evaluation 

requirements with respect to NQTLs 

related to network composition if the 

plan or issuer otherwise complied with 

other applicable MHPAEA 

requirements. However, the 

Departments noted that plans and 

issuers should be prepared to document 

the actions they have taken and to 

demonstrate why any disparities are 

attributable to provider shortages in the 

geographic area, rather than their 

NQTLs related to network composition. 

Several commenters supported the 

special rule for NQTLs related to 

network composition, stating that it 

would address significant barriers to 

accessing mental health and substance 

use disorder services, and requested that 

the heightened requirement for such 

NQTLs be maintained in the final rules. 

Some commenters questioned the 

justification for treating standards for 

network composition differently than all 

other NQTLs. Several commenters 

stated that the Departments 

misrepresented several of the key 

studies they relied on to support the 

proposed special rule. Some 

commenters highlighted that analyzing 

outcomes data related to network 

composition is a long-recognized and 

widely accepted tool in population 

health management but stated that the 

proposed rules would turn this tool into 

a compliance standard that would be 

virtually impossible to satisfy. One 

commenter highlighted that MHPAEA 

requires equity in treatment, not equity 

in outcomes, and that the special rule 

would go beyond what is required by 

statute, as well as the Departments’ own 

admission that parity across mental 

health and substance use disorder and 

medical/surgical networks does not 

necessarily mean an equal number of 

providers in a classification. Another 

commenter stressed that the special rule 

was inappropriate without clarity about 

what the definition of a material 

difference would be. This commenter 

stated that the Departments should 

finalize, following additional public 

comment, an NQTL definition, a 

specific set of measures with technical 

specifications, and a benchmark for 

what they will consider to be ‘‘material 

difference’’ for each NQTL type. Other 

commenters suggested that the 

Departments not finalize this proposed 

provision. 

Some commenters noted that there 

can be many reasons why outcomes 

might be different for mental health and 

substance use disorder benefits than 

medical/surgical benefits when 

evaluating relevant data, particularly 

with respect to network composition. 

Some of these commenters highlighted 

reasons that are outside the control of 

plans and issuers, such as shortages of 

mental health and substance use 

disorder providers or specialists. Some 

commenters requested that the final 

rules address situations where material 

differences in access are due to a lack 

of mental health and substance use 

disorder providers, while other 

commenters stated that general citations 

to provider shortages as the only cause 

of material differences in access should 

be rejected as inadequate, especially 

without evidence that those shortages 

drove disparities, rather than plan or 

issuer choices. One commenter argued 

that plans and issuers should have the 

opportunity to address any apparent 

gaps in network access and explain 

long-term initiatives to address those 

gaps. 

Several commenters expressed 

concern that the special rule as 

proposed would have adverse 

consequences for patient outcomes and 

safety because it would encourage plans 

and issuers to accept lower quality 

providers into their networks. One 

commenter noted that behavioral health 

care is commonly provided by primary 

care providers, and without including 

those providers in relevant data, a 

significant percentage of mental health 

treatment would not be captured when 

determining whether material 

differences in access exist. Other 

commenters expressed the importance 

of taking into account telehealth 

providers when analyzing relevant data 

for purposes of NQTLs related to 

network composition. 

The Departments acknowledge the 

concerns raised by commenters on this 

aspect of the proposed rules; namely, 

the fact that a variety of metrics could 

be consulted as a plan or issuer 

evaluates its parity compliance 

regarding NQTLs related to network 

composition, and that parity for mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits does not necessarily 

mean an equal number of mental health 

or substance use disorder and medical/ 

surgical network providers. The 

Departments also understand the value 

of a consistent approach with regard to 

all NQTLs, while recognizing the impact 

of NQTLs related to network 

composition on access to care. 

Additionally, the Departments 

acknowledge the questions some 

commenters raised requesting more 

specific details on how to account for 

material differences in access for 

network composition NQTLs, including 

those due to provider shortages, which 

plans and issuers may not be able to 

effectively address through no fault of 

their own despite taking reasonable 

action. The Departments also note that 

certain outcomes measures, such as high 

out-of-network utilization for mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits, may not necessarily 

represent a per se violation of MHPAEA. 

The Departments agree with 

commenters that it is important to allow 

plans and issuers to address apparent 

gaps in relevant data, and that it is also 

important that the regulatory standard 

for NQTLs related to network 

composition is one that plans and 

issuers are able to satisfy. However, as 

stated in the preamble to the proposed 

rules, the Departments also recognize 

that network composition and access to 

mental health and substance use 

disorder benefits are the product of 

myriad NQTLs; processes, strategies, 

evidentiary standards, and other factors 


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77620 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

87The proposed rules did not include a similar 

exception from the relevant data evaluation 

requirements for standards related to fraud, waste, 

and abuse. 

used to design and apply NQTLs; and 

information, evidence, sources, and 

standards on which factors and 

evidentiary standards are based. As a 

result, the Departments remain 

concerned that plans and issuers could 

too readily evade their obligations under 

MHPAEA, if they were not obligated to 

diligently collect and evaluate relevant 

data, perform a careful analysis to 

determine whether material differences 

in access to mental health and substance 

use disorder benefits exist as a result of 

the cumulative impact of NQTLs related 

to network composition, and take 

reasonable actions that meaningfully 

address such differences in access. 

After consideration of the comments, 

the Departments are not finalizing the 

proposed special rule for NQTLs related 

to network composition, and are instead 

including language in these final rules 

to explain how plans and issuers are 

expected to comply with the relevant 

data evaluation requirements with 

respect to those NQTLs. Specifically, 

these final rules require that a plan or 

issuer must collect and evaluate data in 

a manner reasonably designed to assess 

the aggregate impact of all such NQTLs 

on access to mental health and 

substance use disorder benefits and 

medical/surgical benefits, instead of 

evaluating relevant data for each NQTL 

separately (which is generally required 

under these final rules for NQTLs other 

than those related to network 

composition), to determine if there is a 

material difference in access. 

Furthermore, the final rules provide 

examples of possible actions that a plan 

or issuer could take to comply with the 

requirement to take reasonable action, 

as necessary, to address any material 

differences in access with respect to 

network composition NQTLs. While 

under these final rules, material 

differences in access related to network 

composition NQTLs are not 

automatically treated as a violation of 

MHPAEA (and instead are treated as a 

strong indicator of a violation, the same 

as all other NQTLs), the Departments 

emphasize that plans and issuers must 

engage in, and document in their 

comparative analyses, all reasonable 

actions, as necessary, to address any 

material differences in access. 

While the approach to material 

differences for NQTLs related to 

network composition is different than 

that set forth in the proposed rules, 

these final rules will achieve the same 

goal of ensuring access to mental health 

and substance use disorder benefits in 

parity with access to medical/surgical 

benefits, by requiring plans and issuers 

to take reasonable action, as necessary, 

to address material differences in access 

for in-network mental health and 

substance use disorder benefits as 

compared to in-network medical/ 

surgical benefits. Furthermore, the 

approach for NQTLs related to network 

composition in these final rules will 

ensure that participants and 

beneficiaries are not subject to NQTLs 

with respect to mental health and 

substance use disorder benefits that are 

more restrictive than the predominant 

NQTLs applied to substantially all 

medical/surgical benefits under the plan 

or coverage. 

The Departments stress the 

importance of the requirement under 

these final rules that plans and issuers 

take reasonable action, as necessary, 

where relevant data suggest that NQTLs 

related to network composition 

contribute to a material difference in 

access to in-network mental health and 

substance use disorder benefits as 

compared to in-network medical/ 

surgical benefits in a classification, to 

ensure compliance with MHPAEA. 

These final rules provide an illustrative 

list of possible actions the Departments 

expect plans and issuers, working with 

their service providers, to take, as 

necessary, to address any material 

differences in access with respect to 

NQTLs related to network composition 

under the relevant data evaluation 

requirements. This includes plans and 

issuers working with their service 

providers, as applicable, to strengthen 

efforts to recruit and encourage a broad 

range of available mental health and 

substance use disorder providers and 

facilities to join the plan’s or issuer’s 

network of providers, including taking 

actions to increase compensation or 

other inducements, streamline 

credentialing processes, or contact 

providers reimbursed for items and 

services provided on an out-of-network 

basis to offer participation in the 

network, and expand the availability of 

telehealth arrangements to mitigate 

overall mental health and substance use 

disorder provider shortages in a 

geographic area. Additionally, plans and 

issuers should provide additional 

outreach and assistance to participants 

and beneficiaries enrolled in the plan or 

coverage to assist them in finding 

available in-network mental health and 

substance use disorder providers and 

facilities, and ensure that provider 

directories are accurate and reliable 

(including in accordance with Code 

section 9820(a), ERISA section 720(a), 

PHS Act section 2799A–5(a), and future 

implementing regulations and 

guidance). The Departments also expect 

plans and issuers to take other 

reasonable actions, as necessary, that are 

intended to mitigate any material 

differences (even if not enumerated in 

these final rules). 

As with other types of NQTLs, these 

final rules require plans and issuers to 

explain in their comparative analyses 

for NQTLs related to network 

composition the circumstances of any 

material differences in access and the 

actions that have been or are being taken 

to address these differences. If such 

actions do not fully resolve the material 

differences, a plan or issuer must 

provide a reasoned explanation in its 

comparative analysis of any material 

differences that persist despite 

reasonable actions that have been or are 

being taken. The Departments stress that 

a comparative analysis making only a 

cursory reference to provider shortages 

with little or no explanation of 

reasonable actions taken to address 

material differences in access will likely 

result in a finding by the relevant 

Secretary that the comparative analysis 

is insufficient and, without additional 

comparative analyses in response to an 

insufficiency notice or initial 

determination of noncompliance from 

the Secretary, may result in a final 

determination of noncompliance. As 

noted elsewhere in this preamble, the 

Departments expect that, if a plan or 

issuer intends to rely on an explanation 

of existing circumstances that cannot 

effectively be addressed through 

reasonable action, the explanation 

should include significant detail as to 

the circumstances resulting in material 

differences in access that are outside the 

plan’s or issuer’s control, and a robust 

discussion of the reasonable actions the 

plan or issuer has taken or is taking in 

an attempt to address such material 

differences. 

Exception for Independent Professional 

Medical or Clinical Standards 

The proposed rules specified a narrow 

exception under which plans and 

issuers would not be required to comply 

with the relevant data evaluation 

requirements for NQTLs that impartially 

apply independent professional medical 

or clinical standards.87 As discussed in 

the following section of the preamble to 

these final rules, the Departments are 

not finalizing this proposed exception. 

e. Independent Professional Medical or 

Clinical Standards and Fraud and Abuse 

Measures 

In the preamble to the proposed rules, 

the Departments acknowledged that the 

application of independent professional 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77621 

88 78 FR 68240, 68245 (Nov. 13, 2013). 

medical or clinical standards and fraud, 

waste, and abuse measures generally 

improve and help to ensure appropriate 

care for participants and beneficiaries, 

rather than restrict access to needed 

benefits. The Departments stated that 

NQTLs that reflect independent 

professional medical or clinical 

standards or guard against fraud, waste, 

and abuse (while minimizing the 

negative impact on access to appropriate 

benefits) are premised on standards that 

generally provide an independent and 

less suspect basis for determining access 

to mental health and substance use 

disorder treatment. Accordingly, the 

Departments proposed two narrow 

exceptions; one for NQTLs that 

impartially apply independent 

professional medical or clinical 

standards, and one for NQTLs 

reasonably designed to detect or prevent 

and prove fraud, waste, and abuse. 

Under those proposed exceptions, an 

NQTL that, with respect to mental 

health or substance use disorder 

benefits in any classification, 

impartially applies independent 

professional medical or clinical 

standards (consistent with generally 

accepted standards of care) would not 

be considered under the proposed rules 

to violate the proposed no more 

restrictive requirements, the prohibition 

on discriminatory factors and 

evidentiary standards, and the relevant 

data evaluation requirements. An NQTL 

that applies fraud, waste, and abuse 

measures would not be considered 

under the proposed rules to violate the 

proposed no more restrictive 

requirements or the prohibition on 

discriminatory factors and evidentiary 

standards. 

The Departments noted in the 

preamble to the proposed rules that they 

do not intend to interfere with a plan’s 

or issuer’s ability to ensure that 

coverage for benefits for the treatment of 

mental health conditions and substance 

use disorders is consistent with 

independent professional medical or 

clinical standards or fraud, waste, and 

abuse measures. The Departments also 

recognized that there are instances in 

which the application of independent 

professional medical or clinical 

standards or fraud, waste, and abuse 

measures might result in differences in 

the design or application of NQTLs to 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits due to clinical 

differences between mental health 

conditions and substance use disorders 

and medical/surgical conditions, as well 

as differences in the model of care, in 

a manner that could otherwise violate 

certain aspects of the requirements for 

NQTLs in the proposed rules. 

Several commenters opposed the 

proposed exceptions because they stated 

that plans and issuers would exploit 

them to improperly limit access to 

mental health and substance use 

disorder services. Some of these 

commenters stated that the Departments 

lack authority or a legal basis to 

implement the proposed exceptions 

because, in their view, the statute does 

not provide authority to establish 

exceptions to MHPAEA’s requirements. 

Commenters also stated that the 

proposed exceptions could significantly 

undermine the other provisions of the 

proposed rules that would otherwise 

strengthen MHPAEA protections by 

creating opportunities for misuse or 

exploitation. Conversely, some 

commenters generally supported the 

proposed exceptions, but highlighted 

ambiguities related to how the 

exceptions would operate under the 

proposed rules to allow NQTLs to be 

applied with respect to mental health 

and substance use disorder benefits. 

These commenters also stated that the 

exceptions may be too narrow as 

proposed and that it is unclear how and 

what a plan or issuer must demonstrate 

to confidently rely on the proposed 

exceptions. 

The Departments acknowledge these 

comments, as well as the comments 

received on each of the two proposed 

exceptions, which are addressed in 

more detail in this section of the 

preamble. After considering the 

comments, and for the reasons 

discussed later in this preamble, the 

Departments are not finalizing the 

proposed exceptions for independent 

professional medical or clinical 

standards or fraud, waste, and abuse 

measures, but explain how plans and 

issuers can account for such standards 

and fraud and abuse measures in 

implementing the provisions of these 

final rules. 

Exception for Independent Professional 

Medical or Clinical Standards 

To qualify for the exception for 

independent professional medical or 

clinical standards under the proposed 

rules, an NQTL would have to 

impartially apply those standards 

(consistent with generally accepted 

standards of care) to medical/surgical 

benefits and mental health or substance 

use disorder benefits. The NQTL could 

not deviate from those standards in any 

way, such as by modifying or otherwise 

imposing additional or different 

requirements. Under the proposed rules, 

an NQTL qualifying for this exception 

would not be required to satisfy the 

proposed no more restrictive 

requirement or the proposed relevant 

data evaluation requirements. In 

addition, the independent professional 

medical or clinical standards would not 

be considered a discriminatory factor or 

evidentiary standard. The Departments 

noted that, under the proposed rules, 

the plan or issuer would still be 

required to ensure that such an NQTL 

complies with the rest of the design and 

application requirements. Additionally, 

the plan or issuer would be required to 

perform and document comparative 

analyses for NQTLs that impartially 

apply independent professional medical 

or clinical standards. 

Some commenters stated that the 

exception for NQTLs that impartially 

apply independent professional medical 

or clinical standards should not be 

finalized, because the Departments 

rejected a similar exception in previous 

rulemaking. Specifically, these 

commenters highlighted that the 

Departments included an exception to 

the NQTL requirements for ‘‘recognized 

clinically appropriate standards of care’’ 

in the 2010 MHPAEA interim final 

regulations, which was later deleted in 

the 2013 final regulations. The preamble 

to the 2013 final regulations supported 

the decision to eliminate the exception 

by pointing to commenters’ concern 

about abuse and the use of this 

exception by plans and issuers to try to 

justify stricter application of NQTLs.88

These commenters highlighted that 

MHPAEA’s statutory standard, as 

amended by the CAA, 2021 does not 

contain such exceptions to the NQTL 

requirements. 

Some commenters urged the 

Departments to not finalize the 

proposed exception for NQTLs that 

impartially apply independent 

professional medical or clinical 

standards and instead require those 

standards to be considered as a factor in 

the NQTL comparative analysis, subject 

to all applicable requirements for 

NQTLs under the proposed rules. 

Alternatively, commenters requested 

that plans and issuers be required to 

document in their comparative analyses 

the ways in which the clinical standards 

and practices used to design and apply 

NQTLs deviate from independent 

professional medical or clinical 

standards, which should be tied to 

criteria or guidelines from relevant 

nonprofit clinical specialty associations. 

These commenters also stated that they 

support analogous State definitions of 

‘‘generally accepted standards of care’’ 

instead of the proposed ‘‘generally 

recognized independent professional 


khammond on DSKJM1Z7X2PROD with RULES2
77622 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

89 215 Ill. Comp. Stat. 5/370c, https://

www.ilga.gov/legislation/ilcs/fulltext.asp?

DocName=021500050K370c; Cal. Health & Saf. 

Code section 1374.72, https://

leginfo.legislature.ca.gov/faces/bill

TextClient.xhtml?bill_id=201920200SB855; Ga. 

Code section 33–1–27 https://www.legis.ga.gov/api/ 

legislation/document/20212022/211212; and N.M. 

Stat. section 59A–23–22, https://www.nmlegis.gov/ 

Sessions/23%20Regular/final/SB0273.pdf. 

medical or clinical standards.’’ 89

Additionally, they suggested support for 

tying the definition to the criteria or 

guidelines from the relevant nonprofit 

clinical specialty associations. 

Some commenters highlighted that 

the proposed exception appears to 

presume that there is a single set or 

‘‘gold standard’’ of independent 

professional medical or clinical 

standards, when in practice, these 

standards can vary greatly, and 

consensus may not always exist for a 

particular condition. The commenters 

noted that medical and clinical 

standards are generally designed to 

guide health care providers and 

facilities in determining appropriate 

care for a given diagnosis or stage of 

treatment, not to determine how the 

standards should best be utilized for 

other purposes, so plans and issuers 

may need to adapt clinical standards to 

apply them in the context of health 

coverage. Therefore, they stated, it is 

unclear that the exception for 

independent professional medical or 

clinical standards as proposed could be 

relied on by plans and issuers as they 

design and apply NQTLs as it is unclear 

if this necessary adaptation would cause 

a plan or issuer to fail to impartially 

apply such standards. 

Other commenters, who generally 

supported this proposed exception, 

stated that they found it to be generally 

vague and undefined. These 

commenters urged the Departments to 

define more clearly what constitutes 

independent professional medical or 

clinical standards for purposes of the 

proposed exception, and many 

commenters suggested language for the 

Departments to consider providing as 

additional clarifications. Some 

commenters noted that to ‘‘apply’’ such 

standards should be understood to mean 

to primarily rely on these resources 

when developing NQTLs and claimed 

that these standards lack the precision 

and detail necessary for the exception to 

be useful. Additionally, commenters 

requested that the Departments provide 

examples of standards that would 

qualify for the proposed exception and 

descriptions of their application. 

After considering the comments, the 

Departments are not finalizing the 

exception for independent professional 

medical or clinical standards as 

proposed. In light of the modifications 

to the requirements made in the final 

rules, the Departments agree with 

commenters that it is more appropriate 

for plans and issuers to include 

independent professional medical or 

clinical standards under the framework 

of the existing NQTL parity analysis 

than to provide an exception from the 

requirements of the final rules. 

Therefore, instead of finalizing the 

exception, the Departments are instead 

providing clarifications for how 

independent professional medical and 

clinical standards will be treated under 

these final rules. Specifically, NQTLs 

that are designed or applied, are based 

on, or are related to independent 

professional medical or clinical 

standards are subject to the design and 

application requirements and the 

relevant data evaluation requirements. 

As noted earlier in this preamble, such 

medical or clinical standards are not 

information, evidence, sources, or 

standards that are biased or not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. Additionally, 

for purposes of the relevant data 

evaluation requirements, differences in 

access to mental health or substance use 

disorder benefits that are attributable to 

the use of independent professional 

medical or clinical standards as the 

basis for a factor or evidentiary standard 

used to design or apply an NQTL are not 

considered to be material. To the extent 

the plan or issuer attributes any 

differences in access to the application 

of such standards, the plan or issuer 

must explain the bases for that 

conclusion in their comparative 

analysis. 

Exception for Measures To Detect or 

Prevent and Prove Fraud and Abuse 

The Departments also proposed an 

exception for NQTLs reasonably 

designed to detect or prevent and prove 

fraud, waste, and abuse. To qualify for 

the exception under the proposed rules, 

fraud, waste, and abuse measures would 

have to be reasonably designed to detect 

or prevent and prove fraud, waste, and 

abuse, based on indicia that have been 

reliably established through objective 

and unbiased data. The proposed rules 

also required that such standards be 

narrowly designed to minimize the 

negative impact on access to appropriate 

mental health and substance use 

disorder benefits. Under the proposed 

rules, an NQTL qualifying for this 

exception would not be required to 

satisfy the proposed no more restrictive 

requirement. In addition, fraud, waste, 

and abuse measures would not be 

considered a discriminatory factor or 

evidentiary standard. The Departments 

noted that, under the proposed rules, 

the plan or issuer would still be 

required to ensure that such an NQTL 

complies with the rest of the design and 

application requirements. The proposed 

rules would also apply the relevant data 

evaluation requirements to these 

NQTLs, as the Departments stated that 

these tools, while important, are more 

likely than independent professional 

medical or clinical standards to result in 

NQTLs that may improperly restrict 

access to mental health and substance 

use disorder benefits because these 

NQTLs are largely both designed by, 

and applied within the control of, the 

plan or issuer. Additionally, the plan or 

issuer would be required to perform and 

document comparative analyses for 

NQTLs that are fraud, waste, and abuse 

measures. 

Many commenters opposed the 

exception for NQTLs that are fraud, 

waste, and abuse measures. Similar to 

the objections to the exception for 

independent professional medical or 

clinical standards, these commenters 

highlighted that MHPAEA’s statutory 

language, as amended by the CAA, 2021 

does not contain exceptions for any 

NQTLs. These commenters voiced 

concern that the two proposed 

exceptions, together, could allow plans 

and issuers to avoid compliance with 

the strengthened requirements of 

MHPAEA set forth in the proposed 

rules. Commenters opposing the fraud, 

waste, and abuse exception generally 

recommended that the Departments 

remove it altogether; however, some 

commenters recommended that, if 

retained, the exception should include 

stronger language limiting plans’ and 

issuers’ ability to invoke the exception. 

These commenters also recommended 

that the Departments eliminate 

references to ‘‘waste,’’ as this is arguably 

targeted by all forms of utilization 

management. Commenters requested 

that, alternatively, plans and issuers be 

required to document in their 

comparative analyses how their efforts 

to combat fraud, waste, and abuse 

comply with MHPAEA (including as a 

factor used to design or apply an 

NQTL). 

Other commenters were generally 

supportive of the exception but 

expressed concerns that the 

Departments would interpret it too 

narrowly. They generally recommended 

that the Departments add definitional 

clarity to allow for flexibility and 

account for the use of a range of NQTLs 

that are fraud, waste, and abuse 

measures and provide examples. Some 

commenters also sought clarification 


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90See 88 FR 51552, 51579 (Aug. 3, 2023). 

91Code section 9812(a)(3)(A), ERISA section 

712(a)(3)(A), and PHS Act section 2726(a)(3)(A). 

92Code section 9812(a)(8), ERISA section 

712(a)(8), and PHS Act section 2726(a)(8). 

about the documentation or evidence 

required for a plan or issuer to prove its 

qualification for the exception. 

The Departments acknowledge that 

many NQTLs consider the potential for 

fraud, waste, and abuse as a factor in 

their design and application and have 

concluded that it is appropriate for 

plans and issuers to be required to treat 

these types of factors and NQTLs 

following the same framework as other 

NQTLs, subject to all applicable 

requirements. The Departments also 

agree that the term ‘‘waste’’ is too broad 

and could arguably include all forms of 

utilization management. Therefore, 

instead of finalizing the exception as 

proposed, the Departments are 

providing clarifications on how fraud 

and abuse measures will be treated 

under these final rules. Specifically, 

NQTLs that are designed or applied, are 

based on, or are related to fraud and 

abuse measures are subject to the design 

and application requirements and the 

relevant data evaluation requirements. 

However, for purposes of the 

prohibition on discriminatory factors 

and evidentiary standards, the final 

rules provide that fraud and abuse 

measures are not information, evidence, 

sources, or standards that are biased or 

not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits. 

Additionally, for purposes of the 

relevant data evaluation requirements, a 

difference in access to mental health 

and substance use disorder benefits 

attributable to the use of fraud and 

abuse measures as the basis for a factor 

or evidentiary standard used to design 

or apply an NQTL is not considered to 

be material. To the extent that a plan or 

issuer attributes any differences in 

access to the application of such 

measures, the plan or issuer must 

explain the bases for that conclusion in 

their comparative analyses. 

Requests for Additional Exceptions 

Some commenters suggested 

additional exceptions to the 

requirements for NQTLs that the 

Departments should consider adding to 

the final rules. Specifically, some 

commenters requested an exception for 

NQTLs related to the quality and safety 

of mental health and substance use 

disorder services. Similarly, another 

commenter recommended the 

Departments include an exception for 

practices to ensure high-quality care, 

based on the view that the two 

exceptions (for independent 

professional medical or clinical 

standards and fraud, waste, and abuse 

measures) in the proposed rules are not 

sufficient to curb substandard and 

ineffective treatment that does not reach 

the level of fraud, waste, and abuse. 

Other commenters suggested exceptions 

for compliance with Federal and State 

law, an exception to ensure the quality 

and safety of mental health and 

substance use disorder benefits, an 

exception to the quantitative testing and 

discriminatory factor analysis for 

Network NQTLs, and an exception for 

when no outcomes data are reasonably 

available. 

The Departments have considered 

whether additional exceptions beyond 

those included in the proposed rules 

should be included in these final rules. 

As discussed earlier in this preamble, 

there are a very limited number of 

NQTLs where no data exist that can 

reasonably assess the NQTL’s impact on 

access. Such NQTLs might include, for 

example, exclusions based on whether 

the treatment is experimental or 

investigative. Therefore, the 

Departments have provided guidance in 

these final rules on how plans and 

issuers must comply with the relevant 

data evaluation requirements for such 

NQTLs. However, as noted earlier in 

this preamble, such plans and issuers 

must still consider whether data can be 

used to reasonably assess the impact of 

the NQTL on relevant outcomes related 

to mental health and substance use 

disorder benefits and medical/surgical 

benefits. Consistent with the reasons 

described earlier in this preamble as to 

why the Departments declined to 

finalize the exceptions contained in the 

proposed rules, these final rules do not 

contain any additional exceptions. 

f. Effect of Final Determination of 

Noncompliance—26 CFR 54.9812– 

1(c)(4)(v), 29 CFR 2590.712(c)(4)(v), and 

45 CFR 146.136(c)(4)(v) 

The proposed rules provided that if a 

plan or issuer receives a final 

determination from the relevant 

Secretary that it is not in compliance 

with the comparative analysis 

requirements with respect to an NQTL, 

the NQTL would violate the substantive 

requirements for NQTLs,90 and the 

relevant Secretary may direct the plan 

or issuer not to impose the NQTL unless 

and until the plan or issuer 

demonstrates to the relevant Secretary 

compliance with the requirements of 

MHPAEA or takes appropriate action to 

remedy the violation. Whereas the 

requirement in the introductory 

paragraph of proposed 26 CFR 54.9812– 

1(c)(4), 29 CFR 2590.712(c)(4), and 45 

CFR 146.136(c)(4) states that a plan or 

issuer may not impose an NQTL in the 

first instance unless it meets all of the 

applicable substantive requirements for 

NQTLs under the proposed rules, this 

proposed provision addresses the effect 

of a final determination of 

noncompliance with the NQTL 

comparative analysis documentation 

requirements under proposed 26 CFR 

54.9812–2, 29 CFR 2590.712–1, and 45 

CFR 146.137. 

The Departments noted in the 

proposed rules that MHPAEA requires 

that ‘‘such plan or coverage shall ensure 

that’’ the treatment limitations comply 

with the substantive requirements of the 

statute.91 The Departments also noted 

that the statute further requires that the 

plan or issuer perform and document 

adequate comparative analyses for 

NQTLs to ensure compliance.92

Therefore, to comply with MHPAEA, 

plans and issuers must comply with 

both the substantive MHPAEA 

requirements and the documentation 

requirements. Under the proposed rules, 

plans and issuers would be required to 

ensure both that they are complying 

with MHPAEA’s substantive 

requirements at all times an NQTL is 

imposed with respect to mental health 

or substance use disorder benefits, and 

that they have properly performed and 

documented comparative analyses for 

the NQTLs imposed on mental health or 

substance use disorder benefits 

(regardless of the timing of any request 

for such documentation). 

Under the proposed rules, when a 

plan or issuer receives a final 

determination from the Departments 

with respect to an NQTL that it has 

failed to demonstrate compliance with 

the NQTL comparative analysis 

documentation requirements under 

proposed 26 CFR 54.9812–2, 29 CFR 

2590.712–1, or 45 CFR 146.137, 

including because the plan or issuer has 

not submitted a sufficient comparative 

analysis to demonstrate compliance, the 

failure would be treated not only as a 

violation of the NQTL comparative 

analysis documentation requirements 

but also as a violation of the substantive 

NQTL rules under proposed 26 CFR 

54.9812–1(c)(4), 29 CFR 2590.712(c)(4), 

and 45 CFR 146.136(c)(4). The 

Departments acknowledged that 

immediate cessation of the application 

of an NQTL may not be feasible for all 

NQTLs. Therefore, under the proposed 

rules, a determination by the 

Departments of whether to require 

immediate cessation would be based on 

the evaluation of facts and 


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93Code section 9812(a)(8), ERISA section 

712(a)(8), and PHS Act section 2726(a)(8). 

94Specifically, Code section 9812(a)(3)(A), ERISA 

section 712(a)(3)(A), and PHS Act section 

2726(a)(3)(A) state that a plan or coverage ‘‘shall 

ensure that . . . the 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). If a plan or 

coverage does not ensure compliance with these 

statutory requirements, the Departments may 

require the plan or issuer to no longer impose the 

NQTL or to otherwise come into compliance. 

Similarly, 26 CFR 54.9812–1(c)(4), 29 CFR 

2590.712(c)(4), and 45 CFR 146.136(c)(4) of these 

final rules state that a plan (or coverage) may not 

impose any NQTL unless it complies with the 

statutory requirement in Code section 9812(a)(3)(A), 

ERISA section 712(a)(3)(A), and PHS Act section 

2726(a)(3)(A). 95PHS Act section 2723(a)(1). 

circumstances involved in the specific 

violation and nature of the underlying 

NQTL. The Departments provided 

examples of such facts and 

circumstances, including the level of 

disruption in the provision of benefits 

under the plan or coverage if the NQTL 

immediately ceased to apply, the 

practicality and complexities involved 

in the cessation of the NQTL, the effect 

on participants and beneficiaries, and 

the likely time needed to cease or 

modify the NQTL. Additionally, the 

Departments noted that this kind of 

determination would take into account 

feedback from the plan or issuer. The 

Departments provided that these facts 

and circumstances would also be 

relevant to the Departments’ assessment 

of the plan’s or issuer’s overall efforts to 

come into compliance with MHPAEA. 

The Departments solicited comments on 

this proposed provision, including 

whether there are specific challenges or 

considerations the Departments should 

be aware of regarding ceasing 

application of particular NQTLs. 

Several commenters supported a 

provision that would give the 

Secretaries the ability to direct a plan or 

issuer to not impose an NQTL after a 

final determination of noncompliance 

and stated that meaningful 

consequences are important to 

incentivize plans and issuers to comply 

with MHPAEA. Some commenters 

urged the Departments to change the 

proposed language stating that ‘‘the 

relevant Secretary may direct the plan 

or issuer not to impose the NQTL’’ to 

‘‘the relevant Secretary shall direct the 

plan or issuer not to impose the NQTL’’ 

to indicate that a plan or issuer will not 

be permitted to apply a noncompliant 

NQTL. Several commenters 

recommended extending this provision 

to States with primary enforcement 

authority for MHPAEA with respect to 

issuers. Some commenters opposed the 

proposed provision, stating that in their 

view there is no legal authority under 

MHPAEA or the CAA, 2021 to demand 

immediate cessation of an NQTL 

without intervention of a court of law. 

Some commenters raised concerns 

about the ability of plans and issuers to 

immediately stop imposing an NQTL, 

particularly mid-year, and with regard 

to NQTLs related to network 

composition. Several commenters 

suggested that, in light of the significant 

potential consequences of a final 

determination of noncompliance, the 

Departments should provide some type 

of appeals process modeled on the 

process for appeals of civil money 

penalties for Medicare Advantage 

Organizations or require review by 

EBSA’s national office or the director of 

the Center for Consumer Information 

and Insurance Oversight (CCIIO) within 

CMS before taking such action when 

there is a final determination of 

noncompliance. 

The Departments are finalizing the 

provision governing the effect of a final 

determination of noncompliance, with 

modifications. The language contained 

in proposed 26 CFR 54.9812–1(c)(4)(vii), 

29 CFR 2590.712(c)(4)(vii), and 45 CFR 

146.136(c)(4)(vii) is being finalized at 26 

CFR 54.9812–1(c)(4)(v)(A), 29 CFR 

2590.712(c)(4)(v)(A), and 45 CFR 

146.136(c)(4)(v)(A). These final rules 

add references to the relevant statutory 

citation,93 to make clear that the effect 

of the final determination of 

noncompliance provision of these final 

rules, including the evaluation of the 

relevant facts and circumstances used to 

determine whether cessation of an 

NQTL is appropriate, is only applicable 

with respect to a plan’s or issuer’s 

violation of the comparative analysis 

requirements, as set forth in Code 

section 9812(a)(8), ERISA section 

712(a)(8), and PHS Act section 

2726(a)(8). If, however, the plan or 

issuer violates MHPAEA’s substantive 

requirements, as set forth in Code 

section 9812(a)(3), ERISA section 

712(a)(3), and PHS Act section 

2726(a)(3), and 26 CFR 54.9812–1(c)(4), 

29 CFR 2590.712(c)(4), and 45 CFR 

146.136(c)(4), by imposing an NQTL 

that violates the ‘‘no more restrictive’’ 

standard, the statute clearly 

contemplates that the plan or issuer not 

apply the NQTL, and the Departments 

have full authority to prohibit the plan 

or issuer from continuing to impose the 

unlawful NQTL.94

The HHS final rules at 45 CFR 

146.136(c)(4)(v)(A) also add references 

to an applicable State authority, as 

requested by commenters, so that the 

regulations are clear that, like the 

Departments, States with enforcement 

authority with respect to MHPAEA 95

are also permitted to direct issuers not 

to impose an NQTL when there is a final 

determination of noncompliance, unless 

and until the issuer demonstrates 

compliance or takes appropriate action 

to remedy the violation. These final 

rules also provide additional specificity 

by clarifying that this provision allows 

the Departments (and an applicable 

State authority) to direct a plan or issuer 

not to impose an NQTL with respect to 

mental health or substance use disorder 

benefits in the relevant classification. 

Additionally, these final rules add 

new paragraph (c)(4)(v)(B) to make clear 

that a determination of whether the 

Departments will require cessation of 

the application of an NQTL will be 

based on an evaluation of the relevant 

facts and circumstances involved in the 

specific final determination and the 

nature of the underlying NQTL. For this 

purpose, the Departments expect that 

such facts and circumstances may 

include, but are not limited to, the level 

of disruption in the provision of benefits 

under the plan or coverage if the NQTL 

immediately ceased to apply, the 

practicality and complexities involved 

in the cessation of the NQTL, the effect 

on participants and beneficiaries of 

continuing or ceasing to apply the 

NQTL, and the likely time needed to 

cease or modify the NQTL. Under these 

final rules, such a determination will 

also take into account the interest of 

plan participants and beneficiaries and 

feedback from the plan or issuer. States 

that are the primary enforcers of 

MHPAEA may take into account these 

or other facts and circumstances when 

determining whether the State will 

require cessation of application of an 

NQTL. 

The Departments decline to modify 

the proposed language to provide that 

the Secretary ‘‘shall’’ direct the plan or 

issuer not to impose the NQTL after a 

final determination of noncompliance 

with the comparative analysis 

requirements. In the preamble to the 

proposed rules and in these final rules, 

the Departments acknowledged that 

immediate cessation of the application 

of an NQTL may not be feasible for all 

NQTLs and that feedback from the plan 

or issuer would be taken into account. 

The Departments understand that not 

requiring immediate cessation of a 

noncompliant NQTL in every situation 

that involves a final determination of 

noncompliance with the comparative 

analysis requirements may allow 

participants and beneficiaries to be 

subject to noncompliant NQTLs. As 

these commenters noted, meaningful 


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96Code section 9812(a)(8)(B)(iv)(V), ERISA 

section 712(a)(8)(B)(iv)(V), and PHS Act section 

2726(a)(8)(B)(iv)(V). 

97See, e.g., 2023 MHPAEA Comparative Analysis 

Report to Congress (July 2023), pg. 52, https://

www.dol.gov/sites/dolgov/files/EBSA/laws-andregulations/laws/mental-health-parity/report-tocongress-2023-mhpaea-comparative-analysis.pdf 

and https://www.cms.gov/cciio/resources/formsreports-and-other-resources#mental-health-parity. 

consequences are important to 

incentivize plans and issuers to comply 

with MHPAEA. However, the 

Departments are of the view that the 

potential negative impacts for 

participants and beneficiaries of 

continuing to apply the NQTL should be 

balanced with the operational feasibility 

of immediately modifying business 

practices, particularly for NQTLs that 

are inherent to the plan design and may 

require time to reform. Such potential 

negative impacts for participants and 

beneficiaries may be better evaluated 

after the Departments review the 

specific facts and circumstances of the 

relevant determination of 

noncompliance with the comparative 

analysis requirements. Therefore, these 

final rules specify that, when 

determining the effect of a final 

determination of noncompliance with 

the comparative analysis requirements, 

each specific violation will have its own 

analysis of the applicable facts and 

circumstances that will be taken into 

account. 

The Departments stress that MHPAEA 

requires plans and issuers to ensure that 

the treatment limitations, including 

NQTLs imposed on mental health or 

substance use disorder benefits in a 

classification, are not more restrictive 

than those applied to medical/surgical 

benefits in the same classification. In 

many cases, a failure to submit a 

sufficient or compliant comparative 

analysis is evidence that a plan or issuer 

cannot substantiate an NQTL’s 

compliance with these applicable 

requirements, and therefore is violating 

MHPAEA’s substantive parity 

requirements. Therefore, where the 

Departments have come to a final 

conclusion that a comparative analysis 

is not compliant and are issuing a final 

determination of noncompliance, 

including because the plan or issuer has 

not submitted a sufficient comparative 

analysis to demonstrate compliance, the 

required corrective action may include 

the removal of such NQTL. The CAA, 

2021 also requires the Departments to 

specify the actions a plan or issuer must 

take to address the violation, and 

include the required actions in the 

annual report to Congress.96 This 

provision makes clear the Departments 

have broad authority to determine the 

appropriate remedy where a plan’s or 

issuer’s comparative analysis is not 

compliant, and this authority allows the 

Departments, depending on the relevant 

facts and circumstances, to specify 

removal of the NQTL as the appropriate 

remedy to address a determination of 

noncompliance. Nothing, however, 

prevents the Departments or applicable 

State authorities from specifying other 

or additional corrective actions or from 

taking enforcement action within their 

respective authorities. 

As stressed in the Departments’ 

reports to Congress, the Departments 

generally engage plans and issuers in 

repeated exchanges—asking follow-up 

questions, seeking additional 

documentation, performing further 

assessments, and affording 

opportunities for explanation—before 

making a final determination of 

noncompliance.97 The Departments 

note that plans and issuers are given 

multiple opportunities to engage with 

the Departments after an initial request 

for comparative analysis and before a 

final determination of noncompliance. 

As described later in this preamble, after 

an initial request for a comparative 

analysis, if the Department concludes 

that a plan or issuer has not submitted 

sufficient information to review the 

requested comparative analyses, the 

plan or issuer will be provided with 

another opportunity to respond to the 

Department’s initial request. If the 

Department reviews the comparative 

analyses (and any additional 

information submitted upon request) 

and makes an initial determination that 

the plan or issuer is not in compliance, 

the plan or issuer is provided another 

opportunity to respond to the 

Department. Because of the multiple 

opportunities to engage with the 

Departments prior to a final 

determination of noncompliance, the 

Departments decline to add any 

additional formal appeal or review 

requirements beyond that required 

under the statute. Any direction not to 

impose an NQTL provided to a plan or 

issuer by the relevant Department will 

take into account all correspondence 

and discussions with the plan or issuer. 

g. NQTL Examples—26 CFR 54.9812– 

1(c)(4)(vi), 29 CFR 2590.712(c)(4)(vi), 

and 45 CFR 146.136(c)(4)(vi) 

The proposed rules contained thirteen 

examples illustrating the NQTL 

requirements, including revised 

versions of some examples included in 

the 2013 final regulations and several 

new examples. Additionally, the 

proposed rules proposed to eliminate 

some examples that were included in 

the 2013 final regulations, in light of the 

additional proposed requirements. 

The Departments received comments 

on each of the proposed examples and 

comments recommending additional 

examples be added. Some commenters 

suggested the Departments use different 

data elements in the examples related to 

the relevant data evaluation 

requirements that in their view would 

better evaluate compliance with 

MHPAEA. Other commenters expressed 

concerns regarding how the proposed 

exceptions to the NQTL requirements 

discussed earlier in this preamble 

would apply and requested that the 

examples address what a plan or issuer 

would be required to document to rely 

on these exceptions. One of these 

commenters also requested an example 

showing analysis of an NQTL that is 

developed based on multiple standards, 

some of which qualify for the proposed 

exception for independent professional 

medical or clinical standards and some 

of which do not. Some commenters 

expressed concern regarding whether 

the proposed mathematical substantially 

all and predominant tests could be 

performed on all NQTLs and requested 

more detailed examples of how to apply 

such tests. 

As noted earlier in this preamble, the 

Departments are declining to finalize 

the proposed mathematical substantially 

all and predominant tests, as well as the 

proposed exceptions for NQTLs that 

impartially apply independent 

professional medical or clinical 

standards or fraud, waste, and abuse 

measures. Therefore, rather than 

providing examples to address these 

provisions, the examples address the 

substantive provisions the Departments 

are finalizing in these final rules, 

including the general requirement that 

NQTLs for mental health and substance 

use disorder benefits not be more 

restrictive, as written or in operation, 

than the predominant NQTL that 

applies to substantially all medical/ 

surgical benefits in the same 

classification, the design and 

application requirements, and the 

relevant data evaluation requirements 

(including potential data elements that 

plans and issuers may consider to be 

relevant data with respect to an NQTL). 

The Departments are adapting some of 

the fact patterns used in the examples 

in the proposed rules related to 

provisions that are not being finalized to 

instead illustrate concepts applicable in 

these final rules, but these final rules do 

not include all of the examples included 

in the proposed rules (or all of the 

examples included in the 2013 final 

regulations). The Departments note that 

the exclusion in these final rules of any 


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98As stated in the preamble to the proposed rules, 

Example 4 was based in part on guidance in FAQs 

Part 39, Q6, https://www.dol.gov/sites/dolgov/files/ 

EBSA/about-ebsa/our-activities/resource-center/ 

faqs/aca-part-39-final.pdf and https://www.hhs.gov/ 

guidance/document/affordable-care-actimplementation-faqs-final-set-39. 

particular fact pattern that was 

previously addressed in examples in the 

proposed rules or the 2013 final 

regulations is not intended to indicate 

that any particular set of facts is 

permissible or prohibited under these 

final rules. Rather, the examples in 

these final rules are included to 

illustrate the application of the various 

provisions included in these final rules. 

Thus, plans and issuers are expected to 

apply the requirements in paragraph 

(c)(4) of these final rules to the specific 

facts and circumstances of the benefit 

design of their respective plans and 

coverage options with respect to all 

NQTLs applicable to mental health and 

substance use disorder benefits, as well 

as the processes, strategies, evidentiary 

standards, and other factors used to 

design or apply them, and any 

information, evidence, sources, or 

standards on which a factor or 

evidentiary standard is based. 

Additionally, as in the proposed rules, 

any example that concludes that the 

plan violates or complies with a 

requirement of these final rules for 

NQTLs should not be read to imply 

compliance with any other requirements 

of these final rules for NQTLs. 

Example 1—Not comparable and 

more stringent factors for 

reimbursement rate methodology, in 

operation. In the proposed rules, 

Example 4 illustrated how plans and 

issuers would be required to ensure 

compliance in operation with the 

proposed design and application 

requirements for a plan’s reimbursement 

rate methodology NQTL.98 These final 

rules redesignate proposed Example 4 as 

Example 1 and illustrate the application 

of the general rule of the design and 

application requirements of these final 

rules with respect to a plan’s 

reimbursement rate methodology NQTL. 

The language in the facts and 

conclusion of proposed Example 4 

referencing an assumption that the 

plan’s methods for determining 

reimbursement rates for mental health 

and substance use disorder benefits 

satisfy the no more restrictive 

requirement has been eliminated to 

reflect, as discussed earlier in this 

preamble, that the Departments decline 

to finalize the proposed mathematical 

substantially all and predominant tests 

in these final rules. 

Accordingly, the facts of Example 1 in 

these final rules assume a plan’s 

reimbursement rate methodology for 

outpatient, in-network providers is 

based on a variety of factors. As written, 

for mental health, substance use 

disorder, and medical/surgical benefits, 

all reimbursement rates for physicians 

and non-physician practitioners for the 

same CPT code are based on a 

combination of factors, such as the 

nature of the service, duration of the 

service, intensity and specialization of 

training, provider licensure and type, 

number of providers qualified to 

provide the service in a given 

geographic area, and market need 

(demand). In operation, the plan utilizes 

an additional strategy to further reduce 

reimbursement rates for mental health 

and substance use disorder nonphysician providers from those paid to 

mental health and substance use 

disorder physicians by the same 

percentage for every CPT code but does 

not apply the same reductions for nonphysician medical/surgical providers. 

Example 1 concludes that the plan 

violates the rules of paragraph (c)(4). 

The plan reimburses non-physician 

providers of mental health and 

substance use disorder services by 

reducing their reimbursement rates from 

the rates for physician providers of such 

services by the same percentage for 

every CPT code but does not apply the 

same reduction to non-physician 

providers of medical/surgical services 

from the rate for physician providers of 

medical/surgical services. Therefore, in 

operation, the factors used in designing 

and applying the NQTL to mental health 

and substance use disorder benefits in 

the outpatient, in-network classification 

are not comparable to, and are applied 

more stringently than, the factors used 

in designing and applying the NQTL 

with respect to medical/surgical benefits 

in the same classification. As a result, 

the NQTL with respect to mental health 

or substance use disorder benefits in the 

outpatient, in-network classification is 

more restrictive than the predominant 

NQTL that applies to substantially all 

medical/surgical benefits in the same 

classification, in violation of 26 CFR 

54.9812–1(c)(4), 29 CFR 2590.712(c)(4), 

and 45 CFR 146.136(c)(4) of these final 

rules. This example illustrates that the 

plan violates the design and application 

requirements and does not address 

whether the plan complies with the 

relevant data evaluation requirements. 

Example 2—Strategy for exclusion for 

experimental or investigative treatment 

more stringently applied to Applied 

Behavior Analysis (ABA) therapy in 

operation. These final rules redesignate 

proposed Example 10 as Example 2 with 

modifications to the conclusion. 

Proposed Example 10 concluded that 

the plan violates the proposed no more 

restrictive requirements because, in 

operation, the plan’s exclusion for 

experimental or investigative treatment 

imposed on ABA therapy limits access 

to the full range of treatment options 

available for a condition or disorder 

under the plan as compared to medical/ 

surgical benefits in the same 

classification. As discussed earlier in 

this preamble, the Departments declined 

to finalize the proposed mathematical 

substantially all and predominant tests. 

However, multiple commenters in 

response to the proposed rules 

expressed support for including an 

example that specifically addresses the 

exclusion of benefits to treat ASD. 

Therefore, in Example 2 of these final 

rules, the Departments are adapting 

proposed Example 10 to demonstrate 

how a strategy for a plan’s exclusion of 

benefits for experimental or 

investigative treatment that applies 

more stringently to ABA therapy, in 

operation, violates the design and 

application requirements, and therefore 

violates the requirements for NQTLs 

under these final rules. 

In Example 2, the facts of proposed 

Example 10 are generally unchanged. A 

plan, as written, generally excludes 

coverage for all treatments that are 

experimental or investigative for 

medical/surgical benefits and mental 

health and substance use disorder 

benefits in the outpatient, in-network 

classification. As a result, the plan 

generally excludes, as experimental, a 

treatment or procedure when no 

professionally recognized treatment 

guidelines include the treatment or 

procedure as a clinically appropriate 

standard of care for the condition or 

disorder and fewer than two 

randomized controlled trials are 

available to support the treatment’s use 

with respect to the given condition or 

disorder. As written, the plan provides 

benefits for the treatment of ASD, which 

is a mental health condition, but, in 

operation, excludes coverage for ABA 

therapy to treat children with ASD, 

deeming it experimental. More than one 

professionally recognized treatment 

guideline defines clinically appropriate 

standards of care for ASD as including 

ABA therapy and more than two 

randomized controlled trials are 

available to support the use of ABA 

therapy as one intervention to treat 

certain children with ASD. 

Example 2 concludes that the plan 

violates the design and application 

requirements with respect to the 

exclusion of ABA therapy because, in 

operation, the plan deviates from its 

strategy to exclude coverage of 

experimental treatment of medical 


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conditions and surgical procedures, 

mental health conditions, and substance 

use disorders because more than one 

professionally recognized treatment 

guideline defines clinically appropriate 

standards of care for ASD as including 

ABA therapy to treat certain children 

with ASD and more than two 

randomized controlled trials are 

available to support the use of ABA 

therapy as one intervention to treat 

certain children with ASD. Therefore, in 

operation, the strategy used to design 

the NQTL for benefits for the treatment 

of ASD, which is a mental health 

condition for purposes of MHPAEA, in 

the outpatient, in-network classification 

is not comparable to, and is applied 

more stringently than, the strategy used 

to design and apply the NQTL for 

medical/surgical benefits in the same 

classification. As a result, the example 

concludes that the NQTL is more 

restrictive and therefore violates 

MHPAEA. This example illustrates that 

the plan violates the design and 

application requirements and does not 

address whether the plan complies with 

the relevant data evaluation 

requirements. 

Example 3—Step therapy protocol 

with exception for severe or irreversible 

consequences, discriminatory factor. 

The Departments received several 

comments asking the Departments to 

provide additional clarification on what 

would be considered discriminatory 

factors and evidentiary standards for 

purposes of determining compliance 

with the design and application 

requirements. Accordingly, the 

Departments are including in these final 

rules a new Example 3 to provide an 

example of circumstances under which 

a plan or issuer would violate the 

prohibition against discriminatory 

factors and evidentiary standards in the 

context of step therapy with exceptions 

for severe or irreversible consequences. 

The facts of Example 3 assume a plan 

has a step therapy protocol that requires 

participants and beneficiaries who are 

prescribed certain drugs to try and fail 

a generic or preferred brand name drug 

before the plan will cover the treatment 

or medication originally prescribed by a 

provider. The plan has an exception to 

this protocol that was developed solely 

by relying on a methodology developed 

by an external third-party organization. 

The third-party organization’s 

methodology, which is not based on an 

independent professional medical or 

clinical standard, identifies instances in 

which a delay in treatment with a drug 

prescribed for a medical condition or 

surgical procedure could result in either 

severe or irreversible consequences. 

However, with respect to a drug 

prescribed for a mental health condition 

or a substance use disorder, the thirdparty organization’s methodology only 

identifies instances in which a delay in 

treatment could result in both severe 

and irreversible consequences. The plan 

does not take any steps to correct, cure, 

or supplement the methodology. 

The conclusion to Example 3 explains 

that the plan violates the prohibition on 

discriminatory factors and evidentiary 

standards under 26 CFR 54.9812– 

1(c)(4)(i)(B), 29 CFR 2590.712(c)(4)(i)(B), 

and 45 CFR 146.136 (c)(4)(i)(B). The 

source upon which the factor used to 

apply the step therapy protocol is based 

is biased or not objective in a manner 

that discriminates against mental health 

or substance use disorder benefits as 

compared to medical/surgical benefits 

because it addresses instances in which 

a delay in treatment with a drug 

prescribed for a medical condition or 

surgical procedure could result in either 

severe or irreversible consequences, but 

only addresses instances in which a 

delay in treatment with a drug 

prescribed for a mental health condition 

or substance use disorder could result in 

both severe and irreversible 

consequences, and the plan fails to take 

the steps necessary to correct, cure, or 

supplement the methodology so that it 

is not biased and is objective. Based on 

the relevant facts and circumstances, 

this source systematically disfavors 

access or is specifically designed to 

disfavor access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits. 

Therefore, the factor used to design 

exceptions to the step therapy protocol 

is discriminatory, for purposes of 

determining comparability and 

stringency under the design and 

application requirements, and it may 

not be relied upon by the plan unless 

the plan takes the steps necessary to 

correct, cure, or supplement it (by, for 

example, taking into account instances 

in which a delay in treatment with a 

drug prescribed for a mental health 

condition or a substance use disorder 

could result in severe or irreversible 

consequences). 

Example 4—Use of historical plan 

data and steps the plan or issuer can 

take to correct, cure, or supplement. The 

Departments are including as Example 4 

of these final rules a revised example 

illustrating how plans and issuers can 

correct, cure or supplement the use of 

historical data or other historical 

information from a time when the plan 

or coverage was not subject to MHPAEA 

or was in violation of MHPAEA’s 

requirements so that the information is 

not considered to be biased or not 

objective and can be used as the basis 

for a factor or evidentiary standard that 

is not discriminatory. The Departments 

stated in the preamble to the proposed 

rules that the proposed rules would 

prohibit reliance on historical plan data 

or other historical information from a 

time when the plan or coverage was not 

subject to MHPAEA (or was in violation 

of MHPAEA’s requirements) and 

provided an example addressing 

calculation of reimbursement rates 

based on historical data on total plan 

spending. Example 4 of these final rules 

references the fact pattern from Example 

4 in the proposed rules but provides 

additional detail and analysis to 

illustrate the application of the 

prohibition on discriminatory factors 

and evidentiary standards under these 

final rules, including how a plan or 

issuer could correct, cure, or 

supplement the use of such data so that 

the information is not considered to be 

biased or not objective. 

Specifically, the facts of Example 4 

assume a plan’s methodology for 

calculating provider reimbursement 

rates relies only on historical plan data 

on total plan spending for each 

specialty, divided between mental 

health and substance use disorder 

providers and medical/surgical 

providers from a time where the plan 

was not subject to MHPAEA. The plan 

used these historical plan data for many 

years to establish base reimbursement 

rates in all provider specialties for 

which it provides medical/surgical, 

mental health, and substance use 

disorder benefits in the inpatient, innetwork classification. In evaluating the 

use of these historical plan data in the 

design of the methodology for 

calculating provider reimbursement 

rates, the plan determined, based on all 

the relevant facts and circumstances, 

that the historical plan data 

systematically disfavor access or are 

specifically designed to disfavor access 

to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. To ensure this 

information about historical 

reimbursement rates is not biased and is 

objective, the plan supplements its 

methodology to develop the base 

reimbursement rates for mental health 

and substance use disorder providers in 

accordance with additional information, 

evidence, sources, and standards that 

reflect the increased demand for mental 

health and substance use disorder 

benefits in the inpatient, in-network 

classification and to attract sufficient 

mental health and substance use 

disorder providers to the network. The 

relevant facts and circumstances 

indicate that the supplemented 


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99As explained earlier in this preamble, these 

final rules state that the provisions with respect to 

these types of NQTLs shall only apply in very 

limited circumstances and, where applicable, shall 

be construed narrowly, consistent with the 

fundamental purpose of MHPAEA. The 

Departments are of the view that data can be 

collected and evaluated for nearly all NQTLs. 

information, evidence, sources, or 

standards do not systematically disfavor 

access and are not specifically designed 

to disfavor access to mental health and 

substance use disorder benefits as 

compared to medical/surgical benefits. 

Example 4 of these final rules 

concludes that the plan does not violate 

the prohibition on discriminatory 

factors and evidentiary standards with 

respect to the plan’s methodology for 

calculating provider reimbursement 

rates in the inpatient, in-network 

classification. The relevant facts and 

circumstances indicate that the plan’s 

use of only historical plan data to design 

its methodology for calculating its 

provider reimbursement rates in the 

inpatient, in-network classification 

would otherwise be considered to be 

biased or not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

since the historical data systematically 

disfavor access or are specifically 

designed to disfavor access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. However, the plan 

took the steps necessary to supplement 

the information, evidence, sources, and 

standards to reasonably reflect the 

increased demand for mental health and 

substance use disorder benefits in the 

inpatient, in-network classification, and 

adjusted the methodology to increase 

reimbursement rates for those benefits, 

thereby ensuring that the information, 

evidence, sources, and standards relied 

upon by the plan for this purpose are 

not biased and are objective. Therefore, 

the factors and evidentiary standards 

used to design the plan’s methodology 

for calculating provider reimbursement 

rates in the inpatient, in-network 

classification are not considered 

discriminatory factors and evidentiary 

standards. 

Example 5—Generally recognized 

independent professional medical or 

clinical standards and more stringent 

prior authorization requirement in 

operation. In the proposed rules, the 

Departments proposed Example 6 to 

illustrate the exception for impartially 

applied independent professional 

medical or clinical standards and when 

a plan fails to satisfy the exception. The 

Departments received comments 

requesting examples to provide further 

clarity on how a plan or issuer may 

properly rely on independent 

professional medical or clinical 

standards in the design and application 

of NQTLs. As described earlier in this 

preamble, the Departments are not 

finalizing this exception as proposed. 

Instead, these final rules specify that the 

use of independent professional medical 

or clinical standards generally will not 

be considered to be biased and not 

objective under these final rules. The 

Departments note that, under these final 

rules, the use of such standards must 

also comply with the other provisions of 

these final rules, including the general 

rule in the design and application 

requirements and the relevant data 

evaluation requirements. Therefore, the 

Departments are modifying proposed 

Example 6 and redesignating it as 

Example 5 in these final rules, to 

illustrate a violation of the design and 

application requirements of these final 

rules when a plan relies on independent 

professional medical or clinical 

standards to inform a factor used to 

design an NQTL with respect to mental 

health and substance use disorder 

benefits that, in operation, is not 

comparable to, and is applied more 

stringently than, the same factor used to 

design the NQTL for medical/surgical 

benefits in the same classification. 

In Example 5 of these final rules, the 

provisions of a plan state that it relies 

on, and does not deviate from, 

independent professional medical or 

clinical standards to inform the factor 

used to design prior authorization 

requirements for both medical/surgical 

and mental health and substance use 

disorder benefits in the prescription 

drug classification. In this example, the 

plan uses the ASAM national practice 

guidelines as the independent 

professional medical or clinical 

standard to inform the factors used to 

design and apply the prior authorization 

requirement for treatment of OUD. The 

ASAM practice guidelines do not 

support prior authorization every 30 

days for buprenorphine/naloxone 

combination for treatment of OUD. 

However, in operation, the plan requires 

prior authorization for buprenorphine/ 

naloxone combination for treatment of 

OUD every 30 days, which is 

inconsistent with independent 

professional medical standards on 

which the factor used to design the 

limitation is based. The plan’s factor 

used to design and apply prior 

authorization requirements for medical/ 

surgical benefits in the prescription 

drug classification relies on, and does 

not deviate from, independent 

professional medical or clinical 

standards. 

The conclusion to Example 5 in these 

final rules states that the plan violates 

the requirements for NQTLs. The ASAM 

national practice guidelines on which 

the factor used to design prior 

authorization requirements for 

substance use disorder benefits is based 

are independent professional medical or 

clinical standards that are not 

considered to be biased or not objective 

in a manner that discriminates against 

mental health and substance use 

disorder benefits under these final rules. 

However, the plan must comply with 

other requirements in these final rules 

for NQTLs, as applicable, with respect 

to such standards or measures that are 

used as the basis for a factor or 

evidentiary standard used to design or 

apply an NQTL. In operation, the plan’s 

factor used to design and apply prior 

authorization requirements with respect 

to substance use disorder benefits is not 

comparable to, and is applied more 

stringently than, the same factor used to 

design and apply prior authorization 

requirements for medical/surgical 

benefits, because the factor relies on, 

and does not deviate from, independent 

professional medical or clinical 

standards for medical/surgical benefits, 

but deviates from the relevant 

guidelines for substance use disorder 

benefits. As a result, the NQTL with 

respect to substance use disorder 

benefits in the prescription drug 

classification is more restrictive than the 

predominant NQTL that applies to 

substantially all medical/surgical 

benefits in the same classification. 

Example 6—Plan claims no data exist 

to reasonably measure impact of NQTL 

on access; medical necessity criteria. As 

described earlier in this preamble, these 

final rules require plans and issuers to 

collect and evaluate relevant data in a 

manner reasonably designed to assess 

the impact of an NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits. Additionally, these 

final rules provide guidance for plans 

and issuers to comply with the relevant 

data evaluation requirements when data 

are initially temporarily unavailable for 

a newly imposed NQTL or no data exist 

that can reasonably measure any 

relevant impact of an NQTL on access.99

Under the facts of new Example 6, a 

plan approves or denies claims for 

mental health and substance use 

disorder benefits and for medical/ 

surgical benefits in the inpatient, innetwork and outpatient, in-network 

classifications based on medical 

necessity criteria. The plan states in its 

comparative analysis that no data exist 

that can reasonably measure any 


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relevant impact of the medical necessity 

criteria NQTL on access to mental 

health or substance use disorder 

benefits as compared to the NQTL’s 

impact on access to medical/surgical 

benefits in the relevant classifications, 

without further explanation. 

The example concludes that the plan 

violates the requirements of these final 

rules. The plan does not comply with 

the requirements under these final rules 

for NQTLs where no data exist that can 

reasonably measure any relevant impact 

of the NQTL on access because the plan 

did not include in its comparative 

analysis a reasoned justification as to 

the basis for its conclusion that there are 

no data that can reasonably measure the 

NQTL’s impact, an explanation of why 

the nature of the NQTL prevents the 

plan from reasonably measuring its 

impact, an explanation of what data was 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

the NQTL complies with the 

requirements of MHPAEA. For example, 

data the plan could have considered 

that could reasonably assess the NQTL’s 

impact might include the number and 

percentage of claims denials, or the 

number and percentage of claims that 

were approved for a lower level of care 

than the level requested on the initial 

claim. The plan has violated the 

relevant data evaluation requirements, 

as it has not collected and evaluated 

relevant data in a manner reasonably 

designed to assess the impact of the 

NQTL on relevant outcomes related to 

access nor did it include sufficient 

information it its comparative analysis 

with respect to the lack of relevant data. 

Example 7—Concurrent review data 

collection; no material difference in 

access. Example 7 in these final rules 

illustrates the application of the relevant 

data evaluation requirements to a 

concurrent review NQTL. This example 

is based on similar facts from Example 

2 in the proposed rules, but language in 

the facts and conclusion of proposed 

Example 2 referencing the no more 

restrictive requirement have been 

eliminated to reflect, as discussed 

earlier in this preamble, that the 

Departments decline to finalize the 

proposed mathematical substantially all 

and predominant tests in these final 

rules (that would prohibit any NQTL 

that is more restrictive than the most 

common or most frequent variation of 

the NQTL applied to at least two-third 

of medical/surgical benefits in a 

classification). 

In this example as modified in these 

final rules, a plan follows a written 

process to apply a concurrent review 

NQTL to all medical/surgical benefits 

and mental health and substance use 

disorder benefits within the inpatient, 

in-network classification. Under this 

process, a first-level review is 

conducted in every instance in which 

concurrent review applies and an 

authorization request is approved by the 

first-level reviewer only if the clinical 

information submitted by the facility 

meets the plan’s criteria for a continued 

stay. If the first-level reviewer is unable 

to approve the authorization request 

because the clinical information 

submitted by the facility does not meet 

the plan’s criteria for a continued stay, 

it is sent to a second-level reviewer who 

will either approve or deny the request. 

The plan collects relevant data, 

including the number of referrals to 

second-level review, and the number of 

denials of concurrent review claims as 

compared to the total number of 

concurrent review claims in the 

inpatient, in-network classification. The 

plan also collects the number of denied 

claims that are overturned on appeal, 

separately for mental health and 

substance use disorder benefits and 

medical/surgical benefits in the 

inpatient, in-network classification. The 

plan evaluates the relevant data and 

determines that, based on the facts and 

circumstances, the data do not suggest 

that the concurrent review NQTL 

contributes to material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits in the 

inpatient, in-network classification. 

Upon requesting the plan’s comparative 

analysis for the concurrent review 

NQTL and reviewing the relevant data, 

the Secretary does not request 

additional data and agrees that the data 

do not suggest material differences in 

access. 

In Example 7 of these final rules, the 

conclusion explains that the plan does 

not violate the relevant data evaluation 

requirements as it collected and 

evaluated relevant data in a manner 

reasonably designed to assess the 

impact of the NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits 

and considered the impact as part of its 

evaluation. Because the relevant data do 

not suggest that the NQTL contributes to 

material differences in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits in the inpatient, innetwork classification, there is no strong 

indicator that the plan violates the 

requirements for NQTLs under these 

final rules. However, the plan is still 

required to comply with the design and 

application requirements under these 

final rules, including the prohibition on 

discriminatory factors and evidentiary 

standards. 

Example 8—Material difference in 

access for prior authorization 

requirement with reasonable action. In 

the proposed rules, Example 1 

illustrates the effect of a disparity in the 

routine approval of benefits for mental 

health conditions and substance use 

disorders compared to benefits for 

medical/surgical conditions in a 

classification under the no more 

restrictive requirement in the proposed 

rules. However, as discussed earlier in 

this preamble, the Departments have 

declined to finalize the proposed 

mathematical substantially all and 

predominant tests. Therefore, the 

Departments are adapting proposed 

Example 1 for use as Example 8 of these 

final rules to illustrate how a plan or 

issuer can satisfy the requirement to 

take reasonable action to address any 

material differences in access as 

necessary to ensure compliance with the 

relevant data evaluation requirements, 

in the context of material differences in 

access in the routine approval of 

benefits for mental health conditions 

and substance use disorders compared 

to medical/surgical benefits in a 

classification. 

In Example 8 of these final rules, a 

plan requires prior authorization that a 

treatment is medically necessary for all 

inpatient, in-network medical/surgical 

benefits and for all inpatient, in-network 

mental health and substance use 

disorder benefits. The plan collects and 

evaluates relevant data in a manner 

reasonably designed to assess the 

impact of the prior authorization 

requirement on relevant outcomes 

related to access to mental health and 

substance use disorder benefits and 

medical/surgical benefits in the 

inpatient, in-network classification. The 

plan’s written process for prior 

authorization states that the plan 

approves inpatient, in-network benefits 

for medical conditions and surgical 

procedures and mental health and 

substance use disorder benefits for 

periods of 1, 3, and 7 days, after which 

a treatment plan must be submitted by 

the patient’s attending provider and 

approved by the plan. Approvals for 

mental health and substance use 

disorder benefits are most commonly 

given only for 1 day, after which a 

treatment plan must be submitted by the 

patient’s attending provider and 

approved by the plan. The relevant data 

show that approvals for 7 days are most 

common for medical conditions and 

surgical procedures under this plan. 

Based on all the relevant facts and 


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circumstances, the difference in the data 

suggests that the NQTL is likely to have 

a negative impact on access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits. Therefore, the 

differences in the data suggest that the 

NQTL contributes to material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

To address these material differences, 

the plan consults more recent medical 

guidelines to update the factors that 

inform its medical necessity NQTLs and 

modifies the prior authorization NQTL 

so that inpatient, in-network prior 

authorization requests for mental health 

or substance use disorder benefits are 

approved for similar periods to what is 

approved for medical/surgical benefits. 

The plan includes documentation of 

this action as part of its comparative 

analysis. 

The conclusion to Example 8 provides 

that, while relevant data for the plan’s 

prior authorization requirements 

suggested that the NQTL contributes to 

material differences in access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits in the classification, 

the plan has taken reasonable action, as 

necessary, to ensure compliance, in 

operation, with the requirements for 

NQTLs under these final rules by 

updating the factors that inform its prior 

authorization NQTL for inpatient, innetwork mental health and substance 

use disorder benefits, so that such 

benefits are approved for similar periods 

to what is approved for medical/surgical 

benefits, and documenting its action 

taken to address material differences in 

access to inpatient, in-network benefits, 

as required under these final rules. 

Example 9—Differences attributable 

to the use of independent professional 

medical or clinical standards. In the 

proposed rules, the Departments 

proposed to add new Example 5 to 

illustrate how a plan may satisfy the 

proposed exception for independent 

professional medical or clinical 

standards. As noted earlier in this 

preamble, the Departments are not 

finalizing that exception, and instead, 

under these final rules, the use of 

independent professional medical or 

clinical standards are not considered to 

be information, evidence, sources, or 

standards that are biased and not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, as long as the 

use of these standards to design or apply 

an NQTL complies with other 

applicable requirements. Furthermore, 

under these final rules, differences in 

access attributable to the use of 

independent professional medical or 

clinical standards for both medical/ 

surgical benefits and mental health and 

substance use disorder benefits are not 

considered to be material. However, to 

the extent a plan or issuer attributes any 

differences in access to the application 

of such standards, the plan or issuer 

must explain its bases for reaching that 

conclusion in its comparative analysis. 

Therefore, the Departments are adapting 

Example 5 of the proposed rules for use 

as Example 9 of these final rules to 

illustrate the treatment of the use of 

independent professional medical or 

clinical standards. 

In Example 9 of these final rules, a 

plan develops a medical management 

requirement for all inpatient, out-ofnetwork benefits for both medical/ 

surgical benefits and mental health and 

substance use disorder benefits to 

ensure treatment is medically necessary. 

The factors and evidentiary standards 

used to design and apply the medical 

management requirement rely on 

independent professional medical or 

clinical standards that are generally 

recognized by health care providers and 

facilities in relevant clinical specialties. 

The processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the medical 

management requirement to mental 

health and substance use disorder 

benefits are comparable to, and are 

applied no more stringently than, the 

processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the requirement 

with respect to medical/surgical 

benefits. The plan collects and evaluates 

relevant data in a manner reasonably 

designed to assess the impact of the 

medical management NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits, 

and considers the impact as part of the 

plan’s evaluation. Within the inpatient, 

out-of-network classification, the 

application of the medical management 

requirement results in a higher 

percentage of denials for mental health 

and substance use disorder claims than 

medical/surgical claims because the 

benefits were found to be medically 

necessary for a lower percentage of 

mental health and substance use 

disorder claims. The plan correctly 

determines that these differences in 

access are attributable to the 

independent professional medical or 

clinical standards that are used as the 

basis for the factors and evidentiary 

standards used to design or apply the 

NQTL and adequately explains the 

bases for that conclusion as part of its 

comparative analysis. 

Example 9 concludes that the plan 

does not violate the requirements under 

these final rules for its medical 

management NQTL. Independent 

professional medical or clinical 

standards are not considered to be 

information, evidence, sources, or 

standards that are biased and not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits and the plan 

otherwise complies with the design and 

application requirements. Additionally, 

the plan does not violate the relevant 

data evaluation requirements because it 

has collected and evaluated relevant 

data, the differences in access are 

attributable to the independent 

professional medical or clinical 

standards that are used as the basis for 

the factors and evidentiary standards 

used to design or apply the medical 

management NQTL, and the plan 

explains the bases for this conclusion in 

its comparative analysis. As a result, the 

NQTL with respect to mental health or 

substance use disorder benefits in the 

inpatient, out-of-network classification 

is no more restrictive than the 

predominant NQTL that applies to 

substantially all medical/surgical 

benefits in the same classification. 

Example 10—Material difference in 

access for standards for provider 

admission to a network with reasonable 

action. In the proposed rules, the 

Departments proposed new Example 13 

to illustrate how plans and issuers may 

comply with the proposed relevant data 

evaluation requirements with respect to 

NQTLs related to network composition, 

including NQTLs for provider and 

facility admission to participate in a 

network or for continued network 

participation, methods for determining 

reimbursement rates, credentialing 

standards, and procedures for ensuring 

the network includes an adequate 

number of each category of providers 

and facilities to provide covered 

services under the plan or coverage. 

These final rules largely adopt Example 

13 as proposed, with some 

modifications to reflect the standards 

included in these final rules, and 

redesignate it as Example 10. 

In Example 10 of these final rules, a 

plan applies NQTLs related to network 

composition in the inpatient, innetwork and outpatient, in-network 

classifications. The plan’s networks are 

constructed by separate service 

providers for medical/surgical benefits 

and mental health and substance use 

disorder benefits. The facts also assume 


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100 26 CFR 54.9831–1(c)(3)(vi)(B)(1), 29 CFR 

2590.732(c)(3)(vi)(B)(1), and 45 CFR 

146.145(b)(3)(vi)(B)(1). 

that the processes, strategies, 

evidentiary standards, and other factors 

used in designing and applying the 

NQTLs related to network composition 

for mental health or substance use 

disorder benefits in the inpatient, innetwork and outpatient, in-network 

classifications are comparable to, and 

are applied no more stringently than, 

the processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the NQTLs with 

respect to medical/surgical benefits in 

the same classifications. In order to 

ensure, in operation, that the NQTLs are 

no more restrictive than the 

predominant NQTLs applied to 

substantially all medical/surgical 

benefits in the classification, the plan 

collects and evaluates relevant data in a 

manner reasonably designed to assess 

the aggregate impact of all the NQTLs 

related to network composition on 

relevant outcomes related to access to 

mental health and substance use 

disorder benefits as compared with 

medical/surgical benefits and considers 

the impact as part of the plan’s 

evaluation. The plan considers relevant 

data that is known, or reasonably should 

be known, including metrics relating to 

the time and distance from plan 

participants and beneficiaries to 

network providers in rural and urban 

regions; the number of network 

providers accepting new patients; the 

proportions of mental health and 

substance use disorder and medical/ 

surgical providers and facilities that 

provide services in rural and urban 

regions who are in the plan’s network; 

provider reimbursement rates (for 

comparable services and benchmarked 

to a reference standard, as appropriate); 

and in-network and out-of-network 

utilization rates (including data related 

to the dollar value and number of 

provider claims submissions). The plan 

determines that the relevant data 

suggest that the NQTLs in the aggregate 

contribute to material differences in 

access to mental health and substance 

use disorder benefits as compared to 

medical/surgical benefits in the 

classifications because, based on all the 

relevant facts and circumstances, the 

differences in the data suggest that the 

plan’s NQTLs related to network 

composition are likely to have a 

negative impact on access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits in the same 

classifications. The plan takes 

reasonable actions, as necessary, to 

address the material differences in 

access, to ensure compliance, in 

operation, with the requirements for 

NQTLs under these final rules, by 

strengthening its efforts to recruit and 

encourage a broad range of available 

providers and facilities to join the plan’s 

network of providers, including by 

taking actions to increase compensation 

and other inducements, streamline 

credentialing processes, contact 

providers reimbursed for items and 

services provided on an out-of-network 

basis to offer participation in the 

network, and develop a process to 

monitor the effects of such efforts; 

expanding the availability of telehealth 

arrangements to mitigate overall 

provider shortages in certain geographic 

areas; providing additional outreach and 

assistance to participants and 

beneficiaries enrolled in the plan to 

assist them in finding available innetwork providers and facilities; and 

ensuring that the plan’s provider 

directories are accurate and reliable. 

The plan documents the efforts that it 

has taken to address the material 

differences in access that the data 

revealed, and also documents the 

reasons beyond the plan’s control that 

the plan believes may contribute to the 

material differences in access, and the 

plan includes the documentation as part 

of its comparative analysis submission. 

Example 10 concludes that the plan 

does not violate the requirements for 

NQTLs under these final rules. The plan 

complies with the design and 

application requirements, and also 

collects and evaluates relevant data, as 

required under these final rules, in a 

manner reasonably designed to assess 

the aggregate impact of all such NQTLs 

on relevant outcomes related to access 

to mental health and substance use 

disorder benefits and medical/surgical 

benefits. While the data suggest that the 

NQTLs contribute to material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits, 

the plan takes reasonable action, as 

necessary, to ensure compliance with 

these final rules. The plan also 

documents the actions that have been 

and are being taken by the plan to 

address material differences in access 

and documents the reasons beyond the 

plan’s control that the plan believes may 

contribute to the material differences in 

access. As a result, the network 

composition NQTLs with respect to 

mental health or substance use disorder 

benefits in the inpatient, in-network and 

outpatient, in-network classifications 

are no more restrictive than the 

predominant NQTLs that apply to 

substantially all medical/surgical 

benefits in the same classifications. 

Example 11—Separate employee 

assistance program (EAP) exhaustion 

treatment limitation applicable only to 

mental health or substance use disorder 

benefits. Example 11 in the proposed 

rules amended Example 6 of the 2013 

final regulations. These final rules retain 

this example as proposed with minor, 

non-substantive changes. 

Specifically, in Example 11, an 

employer maintains both a major 

medical plan and an EAP. The EAP 

provides, among other benefits, a 

limited number of mental health or 

substance use disorder counseling 

sessions. These sessions, together with 

other benefits provided by the EAP, are 

not significant benefits in the nature of 

medical care. Participants are eligible 

for mental health or substance use 

disorder benefits under the major 

medical plan only after exhausting the 

counseling sessions provided by the 

EAP, and no similar exhaustion 

requirement applies with respect to 

medical/surgical benefits provided 

under the major medical plan. 

Example 11 concludes that the 

requirement that limits eligibility for 

mental health and substance use 

disorder benefits under the major 

medical plan until benefits under an 

EAP are exhausted is an NQTL subject 

to MHPAEA. Because the limitation 

does not apply to medical/surgical 

benefits, it violates the prohibition on a 

separate NQTL applicable only to 

mental health or substance use disorder 

benefits. The Departments have also 

included language to note that under 

other Departmental regulations,100 the 

EAP does not qualify as excepted 

benefits because participants in the 

major medical plan are required to use 

and exhaust benefits under the EAP 

(making the EAP a gatekeeper) before 

they are eligible for benefits under the 

plan. 

Example 12—Separate exclusion for 

treatment in a residential facility 

applicable only to mental health and 

substance use disorder benefits. Under 

Example 12 of these final rules, which 

is substantively identical to Example 12 

in the proposed rules and only includes 

minor, non-substantive changes, a plan 

generally covers inpatient, in-network 

and inpatient, out-of-network treatment 

without any limitations on setting, 

including skilled nursing facilities and 

rehabilitation hospitals, provided other 

medical necessity standards are 

satisfied. The plan has an exclusion for 

treatment at residential facilities, which 

the plan defines as an inpatient benefit 

for mental health and substance use 

disorder benefits. This exclusion was 


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101See 26 CFR 54.9812–1(c)(4)(iii), Example 6, 29 

CFR 2590.712(c)(4)(iii), Example 6, and 45 CFR 

146.136(c)(4)(iii), Example 6. 

not generated through any broader 

NQTL (such as medical necessity or 

other clinical guideline). 

Example 12 concludes that the plan 

violates these final rules. The exclusion 

of residential treatment is a separate 

NQTL applicable only to mental health 

and substance use disorder benefits in 

the inpatient, in-network and inpatient, 

out-of-network classifications because 

the plan does not apply a comparable 

exclusion with respect to any medical/ 

surgical benefits in the same benefit 

classification. 

Example 13—Impermissible NQTL 

imposed following a final determination 

of noncompliance and direction by the 

Secretary. In the proposed rules, 

Example 7 provides that a plan that 

continues to impose an NQTL after the 

Secretary issues a final determination of 

noncompliance with the NQTL 

comparative analysis documentation 

requirements and directs the plan not to 

impose the NQTL by a certain date, 

would not comply with the 

requirements applicable to NQTLs. 

These final rules retain this example 

with modifications to add specificity 

and reflect the substantive provisions of 

the final rule and redesignate it as 

Example 13. 

In this example, following an initial 

request by the Secretary for a plan’s 

comparative analysis of the plan’s 

exclusion of mental health and 

substance use disorder benefits for 

failure to complete a course of treatment 

in the inpatient, in-network 

classification, the plan submits a 

comparative analysis for the NQTL. The 

comparative analysis included 

insufficient information to conduct an 

appropriate comparison of the NQTL. 

After review of the comparative 

analysis, as well as additional 

information submitted by the plan after 

the Secretary determines that the plan 

has not submitted sufficient information 

to be responsive to the request, the 

Secretary makes an initial determination 

that the comparative analysis fails to 

demonstrate that the processes, 

strategies, evidentiary standards, and 

other factors used in designing and 

applying the exclusion to mental health 

or substance use disorder benefits in the 

inpatient, in-network classification are 

comparable to, and applied no more 

stringently than, those used in designing 

and applying the NQTL to medical/ 

surgical benefits in the classification. 

Although the plan submits a corrective 

action plan and additional comparative 

analyses within 45 calendar days after 

the initial determination, it does not 

eliminate or alter the exclusion or alter 

the processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the exclusion. 

Moreover, the additional comparative 

analysis still does not include sufficient 

information. The Secretary determines 

that the additional comparative analyses 

do not demonstrate compliance with the 

requirements for NQTLs under 

MHPAEA. Accordingly, the plan 

receives a final determination of 

noncompliance with the statutory 

comparative analysis documentation 

requirements from the Secretary, which 

concludes that the plan did not 

demonstrate compliance through the 

comparative analysis process. After 

considering the relevant facts and 

circumstances, and considering the 

interests of plan participants and 

beneficiaries, as well as feedback from 

the plan, the Secretary directs the plan 

not to impose the NQTL by a certain 

date, unless and until the plan 

demonstrates compliance to the 

Secretary or takes appropriate action to 

remedy the violation. The plan makes 

no changes to its plan terms by that date 

and continues to impose the exclusion 

of benefits for failure to complete a 

course of treatment in the inpatient, innetwork classification. 

This Example 13 concludes that, by 

continuing to impose the exclusion of 

mental health and substance use 

disorder benefits for failure to complete 

a course of treatment in the inpatient, 

in-network classification after the 

Secretary directs the plan not to impose 

this NQTL, the plan violates the 

requirements of these final rules related 

to the effect of a final determination of 

noncompliance. 

4. Prohibition on Financial 

Requirements and Treatment 

Limitations Applicable Only to Mental 

Health or Substance Use Disorder 

Benefits—26 CFR 54.9812–1(c)(2)(i) and 

(c)(4)(iv), 29 CFR 2590.712(c)(2)(i) and 

(c)(4)(iv), and 45 CFR 146.136(c)(2)(i) 

and (c)(4)(iv) 

The Departments proposed to amend 

the general parity requirement set forth 

in 26 CFR 54.9812–1(c)(2)(i), 29 CFR 

2590.712(c)(2)(i), and 45 CFR 

146.136(c)(2)(i) by adding a sentence to 

reiterate that a plan or issuer may not 

impose any financial requirement or 

treatment limitation that is applicable 

only with respect to mental health or 

substance use disorder benefits and not 

to any medical/surgical benefits in the 

same benefit classification. The 

preamble to the proposed rules noted 

that the 2013 final regulations do not 

explicitly incorporate the statutory 

prohibitions on separate financial 

requirements and treatment limitations 

that are imposed only with respect to 

mental health or substance use 

disorders in Code sections 

9812(a)(3)(A)(i) and (ii), ERISA sections 

712(a)(3)(A)(i) and (ii), and PHS Act 

sections 2726(a)(3)(A)(i) and (ii), 

respectively, but noted that financial 

requirements and quantitative treatment 

limitations imposed only with respect to 

mental health or substance use disorder 

benefits generally could not comply 

with the parity requirements contained 

in paragraph (c)(3) of 26 CFR 54.9812– 

1, 29 CFR 2590.712, and 45 CFR 

146.136. Additionally, the Departments 

referred to an example in the 2013 final 

regulations that demonstrates and 

affirms that an NQTL applied only to 

mental health or substance use disorder 

benefits would not be permissible.101

The Departments noted in the proposed 

rules that these amendments would 

directly incorporate the statutory 

prohibitions by expressly stating that 

plans and issuers are not permitted to 

impose any type of financial 

requirement or treatment limitation that 

applies only to mental health or 

substance use disorder benefits and not 

to medical/surgical benefits in the same 

classification. 

Additionally, since the 2013 final 

regulations state that the application of 

paragraph (c)(2) to NQTLs is addressed 

in paragraph (c)(4) of the regulations, 

the Departments also proposed to add 

similar language to the proposed rules 

for NQTLs at 26 CFR 54.9812– 

1(c)(4)(vi), 29 CFR 2590.712(c)(4)(vi), 

and 45 CFR 146.136(c)(4)(vi), which 

cross-reference the language proposed to 

be added to 26 CFR 54.9812–1(c)(2)(i), 

29 CFR 2590.712(c)(2)(i), and 45 CFR 

146.136(c)(2)(i). The Departments 

proposed that a plan or issuer may not 

apply any NQTL that is applicable only 

with respect to mental health or 

substance use disorder benefits and not 

with respect to any medical/surgical 

benefits in the same benefit 

classification. The Departments noted 

that an exclusion of benefits for a 

mental health condition or substance 

use disorder in a classification that is 

merely an expression of another NQTL, 

such as medical necessity requirements 

or experimental or investigational 

exclusions, that is applied with respect 

to medical/surgical benefits in the same 

classification would not be considered a 

separately applicable treatment 

limitation. As a result, such an NQTL 

would be evaluated to determine 

whether such NQTL complies with all 

applicable requirements of these final 

rules. 


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Many commenters supported 

reiterating the statutory requirement 

that a plan or issuer must not impose a 

financial requirement or treatment 

limitation that is applicable only to 

mental health or substance use disorder 

benefits and specifying that if an 

exclusion of a mental health or 

substance use disorder treatment or 

service is not due to the application of 

another NQTL to both mental health or 

substance use disorder benefits and 

medical/surgical benefits in a 

classification, such exclusion would be 

subject to this prohibition. Commenters 

also agreed with the Departments that, 

if an exclusion of benefits for a mental 

health condition or substance use 

disorder is not generated through a 

process, strategy, or factor, or informed 

by an evidentiary standard of a broader 

NQTL like medical necessity, such an 

exclusion would need to be evaluated 

for parity compliance (and would 

therefore be prohibited, provided it does 

not apply to medical/surgical benefits). 

One commenter requested the 

Departments clarify that a specific 

NQTL need not be applicable to 

medical/surgical benefits in the same 

classification to overcome the notion 

that the limitation is separately 

applicable. 

The Departments agree with 

commenters that the proposed 

prohibition on NQTLs applicable only 

to mental health or substance use 

disorder benefits is consistent with the 

statute, and that an exclusion of benefits 

for a mental health condition or 

substance use disorder otherwise 

covered under the plan or coverage not 

generated through a process, strategy, or 

factor, or informed by an evidentiary 

standard of a broader NQTL like 

medical necessity should be evaluated 

for MHPAEA compliance. This 

exclusion is prohibited as an 

impermissible separate treatment 

limitation if a comparable exclusion 

does not apply to medical/surgical 

benefits in the classification. 

Additionally, as evaluation of a plan’s 

or issuer’s compliance with MHPAEA is 

generally assessed within a 

classification of benefits, the prohibition 

on separately applicable financial 

requirements or treatment limitations 

applies with respect to benefits in the 

same benefit classification. Therefore, 

the Departments are finalizing these 

amendments as proposed at 26 CFR 

54.9812–1(c)(2)(i) and (c)(4)(iv), 29 CFR 

2590.712(c)(2)(i) and (c)(4)(iv), and 45 

CFR 146.136(c)(2)(i) and (c)(4)(iv) to 

reiterate that a plan or issuer may not 

impose any financial requirement or 

treatment limitation that is applicable 

only with respect to mental health or 

substance use disorder benefits and not 

with respect to any medical/surgical 

benefits in the same benefit 

classification. 

5. Other Amendments 

a. Meaningful Benefits 

The Departments proposed to amend 

26 CFR 54.9812–1(c)(2)(ii)(A), 29 CFR 

2590.712(c)(2)(ii)(A), and 45 CFR 

146.136(c)(2)(ii)(A) to specify that, if a 

plan (or health insurance coverage) 

provides any benefits for a mental 

health condition or substance use 

disorder in any classification of benefits, 

benefits for that mental health condition 

or substance use disorder must be 

provided in every classification in 

which medical/surgical benefits are 

provided. The proposed rules proposed 

that for purposes of this provision, if a 

plan (or health insurance coverage) 

provides any benefits for a mental 

health condition or substance use 

disorder in any classification of benefits, 

the plan or issuer would not be 

considered to provide benefits for the 

mental health condition or substance 

use disorder in every classification in 

which medical/surgical benefits are 

provided unless the plan or issuer 

provides meaningful benefits for 

treatment for that condition or disorder 

in each classification, as determined in 

comparison to the benefits provided for 

medical conditions and surgical 

procedures in such classification. The 

Departments noted in the preamble to 

the proposed rules that this requirement 

would ensure that, when plans and 

issuers cover benefits for a range of 

services or treatments for medical/ 

surgical conditions in a classification, 

plans and issuers cannot provide, for 

example, only one limited benefit for a 

mental health condition or substance 

use disorder in that classification. The 

Departments requested comments on 

this provision of the proposed rules, 

including whether and how to define 

‘‘meaningful benefits’’ and other 

potential alternatives. 

Many commenters expressed support 

for this provision of the proposed rules. 

Several of these commenters noted that 

this requirement is essential to ensure 

that plans and issuers are no longer able 

to deny reimbursement of fundamental 

evidence-based services for the 

treatment of mental health conditions 

and substance use disorders in a way 

that similar services would never be 

excluded for medical/surgical care. 

Conversely, some commenters 

opposed adopting any ‘‘meaningful 

benefit’’ or similar standard in these 

final rules. Several commenters argued 

that this proposed requirement exceeds 

the Departments’ statutory authority, 

and that by requiring ‘‘meaningful 

benefits,’’ the Departments would 

convert MHPAEA into a mandate to 

cover mental health and substance use 

disorder benefits. Other commenters 

stated that the approach would require 

plans and issuers to compare specific 

treatments, which is inconsistent with 

congressional intent to preserve the 

ability of a plan or issuer to determine 

whether a specific treatment is 

medically necessary or appropriate, 

instead of comparing coverage for 

medical/surgical benefits and mental 

health or substance use disorder 

benefits more generally. Additionally, 

one commenter stated this provision 

would significantly broaden the scope 

and complexity of a plan’s or issuer’s 

compliance analysis and limit flexibility 

in benefit design. Some commenters 

noted that the meaningful benefits 

standard, as proposed, might adversely 

affect the operation of closed panel 

plans, as the provision of any services 

outside the network could require such 

plans to evaluate and expand the scope 

of covered mental health and substance 

use disorder benefits, or alternatively, 

restrict out-of-network benefits. 

Commenters also expressed concern 

that the term ‘‘meaningful benefits’’ may 

not include services such as coordinated 

specialty care for first episode 

psychosis, and without a clear 

definition of the term, such services 

would not be covered for privately 

insured individuals. Another 

commenter stated that the proposed 

meaningful benefit standard may 

overlook and devalue the mental health 

and substance use disorder services 

provided by primary care physicians 

and pediatricians, who are generally 

considered to be medical/surgical 

providers. 

The Departments received many 

comments on how to define the term 

‘‘meaningful benefits,’’ as well as 

potential alternatives, including 

whether it would be more practical to 

require plans and issuers to provide 

‘‘substantial coverage’’ of mental health 

and substance use disorder benefits or 

benefits for the ‘‘primary or most 

common or frequent types of treatment 

for a covered condition or disorder’’ in 

each classification in which medical/ 

surgical benefits are provided. Many 

commenters generally recommended 

defining ‘‘meaningful benefits’’ based on 

independent medical and clinical 

guidelines or primary evidence-based 

treatment based on independent 

standards of current medical practice. 

Some commenters recommended that 

‘‘meaningful benefits’’ be defined as the 


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full continuum of services that are 

consistent with independent 

professional medical or clinical 

standards (or, equivalently, the term 

‘‘generally accepted standards of care’’). 

Other commenters recommended that 

these final rules require coverage of at 

least one primary treatment for a mental 

health condition or substance use 

disorder in a classification or coverage 

that aligns with coverage under the 

State’s designated EHB-benchmark plan. 

A few commenters recommended that 

the definition of ‘‘meaningful benefits’’ 

or primary treatment be further 

developed through additional notice 

and comment rulemaking or a request 

for information. 

The Departments recognize, as 

commenters stated, that additional 

clarifications are warranted regarding 

the definition of the term ‘‘meaningful 

benefits.’’ With regard to comments 

stating that this provision of the 

proposed rules is a benefit mandate that 

would require plans and issuers to cover 

specific treatments, as well as comments 

that raised concerns about specific 

mental health and substance use 

disorder services not being considered 

meaningful benefits (and therefore not 

being covered by plans and issuers), the 

Departments reiterate that this 

requirement does not require plans and 

issuers to cover mental health and 

substance use disorder benefits 

independently or irrespective of what is 

provided with respect to medical/ 

surgical benefits. 

After considering comments received, 

the Departments are finalizing the 

proposed meaningful benefits standard, 

with modifications and clarifications. 

These final rules require that, if a plan 

(or health insurance coverage) provides 

any benefits for a mental health 

condition or substance use disorder in 

any classification of benefits, it must 

provide meaningful benefits for that 

mental health condition or substance 

use disorder in every classification in 

which medical/surgical benefits are 

provided. For this purpose, whether the 

benefits provided are meaningful 

benefits is determined in comparison to 

the benefits provided for medical 

conditions and surgical procedures in 

the classification, and requires, at a 

minimum, coverage of benefits for that 

condition or disorder in each 

classification in which the plan (or 

coverage) provides benefits for one or 

more medical conditions or surgical 

procedures. Additionally, a plan (or 

coverage) does not provide meaningful 

benefits under these final rules unless it 

also provides benefits for a core 

treatment for that condition or disorder 

in each classification in which the plan 

(or coverage) provides benefits for a core 

treatment for one or more medical 

conditions or surgical procedures. 

The Departments note that, while 

these final rules only require plans and 

issuers to cover a minimum of one core 

treatment for a covered mental health 

condition or substance use disorder in 

every classification of benefits in which 

the plan (or coverage) provides benefits 

for a core treatment for one or more 

medical conditions or surgical 

procedures, plans and issuers are 

strongly encouraged to provide more 

robust coverage to ensure that 

participants and beneficiaries have 

access to the mental health and 

substance disorder care they need. The 

Departments incorporate this 

requirement in 26 CFR 54.9812– 

1(c)(2)(ii), 29 CFR 2590.712(c)(2)(ii), and 

45 CFR 146.136(c)(2)(ii) of these final 

rules, as suggested by commenters, to 

ensure that plans and issuers offering 

mental health or substance use disorder 

benefits do not provide coverage for the 

full range of medical/surgical benefits in 

a classification, yet cover only one or a 

few isolated ancillary benefits for a 

covered mental health condition or 

substance use disorder in the same 

classification. As noted earlier in this 

preamble, a commenter expressed the 

concern that this requirement would 

broaden the scope and complexity of 

analyzing MHPAEA NQTL compliance 

and limit benefit design. However, as 

noted above, this provision amends the 

general requirement and limits the 

ability of a plan or issuer to implement 

a benefit design that provides robust 

benefits for medical conditions and 

surgical procedures while offering 

minimal benefits for mental health 

conditions and substance use disorders. 

This requirement, in combination with 

the other amendments to these final 

rules, will help to better ensure 

equitable access to mental health and 

substance use disorder benefits as 

compared to medical/surgical benefits. 

For purposes of these final rules, a 

core treatment for a condition or 

disorder is a standard treatment or 

course of treatment, therapy, service, or 

intervention indicated by generally 

recognized independent standards of 

current medical practice. This definition 

of ‘‘meaningful benefits’’ takes an 

approach that is similar to the 

suggestion made by multiple 

commenters, as noted earlier in this 

preamble, that meaningful benefits be 

defined as the primary treatment for a 

condition or disorder based on generally 

recognized independent standards of 

current medical practice. However, 

instead of defining ‘‘meaningful 

benefits’’ as coverage for the primary 

treatment for a condition or disorder in 

a classification, these final rules require 

the coverage of a core treatment 

because, from a medical or clinical 

perspective, there may not be a single 

primary treatment in many cases for a 

given condition or disorder (even where 

there are evidence-based treatments, 

services, therapies, and standards of 

care). 

These final rules do not set forth 

specific requirements for plans and 

issuers to determine what constitutes a 

core treatment for any particular 

condition or disorder, but plans and 

issuers, in determining a core treatment 

for a condition or disorder in this 

context, should rely on current 

evidence-based medical and clinical 

information. The Departments note that 

a core treatment for a particular 

condition or disorder may not 

necessarily refer to a single item or 

service but may instead encompass a 

suite of items and services that together 

constitute a core treatment, depending 

on the relevant generally recognized 

independent standards of current 

medical practice. In such a case, the 

Departments expect that under this 

provision, plans and issuers will cover 

all components of at least one core 

treatment if the items and services 

provided as part of the treatment span 

a number of classifications, provided 

the plan or coverage provides benefits 

for one or more core treatments for any 

medical conditions or surgical 

procedures in those classifications. For 

example, one core treatment for major 

depressive disorder generally includes 

prescription drugs and psychotherapy. 

However, a core treatment may also 

include only prescription drugs or only 

psychotherapy (and in cases of severe 

depression, may also include inpatient 

hospitalization or other types of 

residential or outpatient treatment). The 

Departments note that a core treatment, 

with respect to a classification, may 

include the same item or service in 

other benefit classifications. For 

example, for major depressive disorder, 

psychotherapy could be a core treatment 

with respect to both the outpatient, innetwork and outpatient, out-of-network 

classifications. In response to 

commenter requests for examples of 

meaningful benefits, the Departments 

have modified proposed Examples 5 

and 6, and added examples that further 

illustrate the application of the 

meaningful benefit standard, as 

discussed in more detail later in this 

preamble. 

The Departments also recognize the 

workability concerns raised by 

commenters with respect to the 

proposed meaningful benefits standard 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77635 

102See 78 FR 68240, 68246–68247 (Nov. 13, 

2013). 

103 Ibid. In the preamble to the 2013 final 

regulations, the Departments stated that plans and 

issuers must assign covered intermediate mental 

health and substance use disorder benefits to the 

existing six benefit classifications in the same way 

that they assign comparable intermediate medical/ 

surgical benefits to these classifications. The 2013 

final regulations also included additional examples 

illustrating the application of the NQTL rules to 

plan exclusions affecting the scope of services and 

clarified that plan or coverage restrictions based on 

geographic location, facility type, provider 

specialty, and other criteria that limit the scope or 

duration of treatment must comply with the NQTL 

parity standard under the final rules. 

104 Id. at 68247. For example, as described in the 

preamble to the 2013 final regulations, if a plan or 

issuer classifies care in skilled nursing facilities or 

rehabilitation hospitals as inpatient benefits, then 

the plan or issuer must likewise treat any covered 

care in residential treatment facilities for mental 

health or substance use disorders as an inpatient 

benefit. In addition, if a plan or issuer treats home 

health care as an outpatient benefit, then any 

covered intensive outpatient mental health or 

substance use disorder services and partial 

hospitalization must be considered outpatient 

benefits as well. 105 75 FR 5410, 5413 (Feb. 2, 2010). 

in the proposed rules. In response to 

these comments, the Departments 

include language in these final rules to 

provide that, if there is no core 

treatment for a mental health condition 

or substance use disorder with respect 

to a classification, the plan (or coverage) 

is not required to provide benefits for a 

core treatment for such condition or 

disorder in that classification. Instead, 

the plan (or coverage) must provide 

benefits for such condition or disorder 

in every classification in which 

medical/surgical benefits are provided. 

Additionally, under these final rules, if 

the plan (or coverage) does not provide 

meaningful benefits for any medical 

condition or surgical procedure in a 

classification, the plan (or coverage) is 

not required to provide meaningful 

benefits for any mental health 

conditions or substance use disorders in 

the classification. This language further 

makes clear that the requirement to 

provide coverage of meaningful benefits 

for a condition or disorder is not a 

coverage mandate, but rather another 

approach to ensuring parity between 

mental health or substance use disorder 

benefits and medical/surgical benefits in 

a classification. 

The Departments also stated in the 

preamble to the proposed rules that they 

recognize that the meaningful benefits 

proposal is related to an issue 

characterized as ‘‘scope of services’’ or 

‘‘continuum of care,’’ as addressed in 

the preamble to the 2013 final 

regulations.102 ‘‘Scope of services,’’ 

when used in this context, generally 

refers to the types of treatment and 

treatment settings that are covered by a 

plan or coverage. The Departments 

requested comments on whether 

additional guidance is needed regarding 

how the proposed meaningful benefits 

standard would interact with the 

approach related to scope of services 

adopted under the 2013 final 

regulations. 

Commenters suggested the 

Departments add ‘‘scope of services’’ or 

‘‘scope of covered services’’ to the 

illustrative, non-exhaustive list of 

NQTLs. These commenters noted the 

importance of psychiatric care being 

fully integrated with the rest of 

medicine in primary care settings and in 

hospitals. Despite the language in the 

2013 final regulations on intermediate 

services,103 these commenters 

highlighted that plans and issuers 

sometimes exclude fundamental 

services and do not assess those 

exclusions as NQTLs. These 

commenters noted that identifying 

‘‘scope of services’’ or ‘‘scope of covered 

services’’ as a covered NQTL would 

remove ambiguity and require plans and 

issuers to determine whether an 

exclusion of mental health or substance 

use disorder benefits met the NQTL 

comparability and stringency test. 

The Departments acknowledge these 

comments and the importance of 

psychiatric care being fully integrated in 

primary care settings and in hospitals 

but decline to add scope of services as 

an NQTL in the illustrative list in these 

final rules. Like the 2013 final 

regulations, these final rules are not 

intended to mandate coverage of any 

particular benefits. These final rules 

continue to require mental health and 

substance use disorder benefits and 

medical/surgical benefits to be assigned 

to the six classifications set forth in the 

regulations. For intermediate services 

like residential treatment, partial 

hospitalization, and intensive outpatient 

treatment, the Departments continue to 

require plans and issuers to assign 

covered intermediate mental health and 

substance use disorder benefits to the 

existing six benefit classifications in the 

same way that they assign comparable 

intermediate medical/surgical benefits 

to these classifications.104 The 

Departments point to the examples in 

these final rules that address coverage 

restrictions based on geographic 

location, facility types, provider 

specialty, and other criteria that limit 

the scope or duration of benefits. Plans 

and issuers are required to comply with 

the NQTL requirements with respect to 

these types of restrictions. Further, the 

Departments note that exclusions of 

services to treat a condition or disorder 

otherwise covered by the plan or 

coverage are NQTLs that must comply 

with the provisions applicable to 

NQTLs under the final rules (including 

that there are no separate NQTLs that 

apply only to mental health or 

substance use disorder benefits in a 

classification). 

In response to questions about 

whether the No Surprises Act’s 

requirements that certain out-of-network 

items and services be covered by plans 

and issuers might adversely affect the 

operation of closed panel plans by 

effectively requiring the coverage of outof-network mental health or substance 

use disorder benefits (including in the 

context of the meaningful benefits 

standard in these final rules), the 

Departments note that nothing in these 

final rules requires a plan or coverage 

that provides coverage for medical/ 

surgical benefits in the inpatient, out-ofnetwork and outpatient, out-of-network 

classifications only to the extent 

required under Code sections 9816 and 

9817, ERISA sections 716 and 717, and 

PHS Act sections 2799A–1 and 2799A– 

2 to provide additional mental health or 

substance use disorder benefits in the 

inpatient, out-of-network and 

outpatient, out-of-network 

classifications in accordance with this 

section. This approach is consistent 

with language in the 2013 final 

regulations which stated that 

compliance with PHS Act section 2713 

(requiring coverage for recommended 

preventive services without any costsharing requirements) should not 

require that the full range of benefits for 

a mental health condition or substance 

use disorder be provided under 

MHPAEA. The proposed amendments 

to 26 CFR 54.9812–1(c)(2)(ii), 29 CFR 

2590.712(c)(2)(ii), and 45 CFR 

146.136(c)(2)(ii) would also make 

explicit the Departments’ interpretation 

that the requirement to provide coverage 

for mental health and substance use 

disorder benefits in each classification 

in which medical/surgical benefits are 

provided applies on a condition or 

disorder basis, an interpretation that the 

Departments have held since the 2010 

interim final rules implementing 

MHPAEA.105

The Departments solicited comments 

on the provisions of the proposed rules 

on classifications of benefits, including 

whether additional flexibility is needed 

to account for benefits that are difficult 

to place into classifications under the 

current structure, and whether 

additional guardrails or protections 

should be required. The Departments 

received very few comments on this 

issue. Most of the comments received 

related to the classification of certain 


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77636 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

106As stated earlier in this preamble, the 

proposed rules stated, and these final rules 

continue to state, that for purposes of MHPAEA, 

ASD is a mental health condition under generally 

recognized independent standards of current 

medical practice. Therefore, benefits for this 

condition are considered mental health benefits, 

and are subject to the protections of MHPAEA and 

its implementing regulations. 

107 DSM (5th ed.), Section II: Diagnostic Criteria 

and Codes, Autism Spectrum Disorder. 

benefits as medical/surgical instead of 

mental health or substance use disorder. 

One comment suggested that a new 

classification of ‘‘urgent/crisis care’’ 

should be added to encompass both 

medical/surgical urgent care and mental 

health or substance use disorder crisis 

services. Because additional 

classifications are not required or 

necessary, the Departments are 

finalizing these amendments as 

proposed. Plans and issuers are 

reminded that the list of the current 

classifications in these final rules is 

exhaustive. Classification of benefits as 

medical/surgical benefits instead of 

mental health or substance use disorder 

benefits is discussed in more detail 

earlier in this preamble. The 

Departments will consider whether and 

to what extent additional guidance may 

be needed to address the application of 

MHPAEA to urgent/crisis care. 

In the proposed rules, the 

Departments proposed to add two 

examples to 26 CFR 54.9812– 

1(c)(2)(ii)(C), 29 CFR 

2590.712(c)(2)(ii)(C), and 45 CFR 

146.136(c)(2)(ii)(C) to illustrate the 

application of these proposed 

amendments. The Departments are 

finalizing these examples with 

modifications to align with these final 

rules and are providing additional 

clarity on the application of the 

meaningful benefits standard to plans 

and issuers by redesignating proposed 

Example 6 as Example 7 and adding 

new Examples 6 and 8. 

In proposed Example 5, a plan 

generally covers treatment for ASD, a 

mental health condition,106 and covers 

outpatient, out-of-network 

developmental evaluations for ASD but 

excludes all other benefits for outpatient 

treatment for ASD, including ABA 

therapy, when provided on an out-ofnetwork basis. The preamble of the 

proposed rules stated that, based on 

generally recognized independent 

standards of current medical practice 

consulted, ABA therapy is the primary 

treatment for ASD in children. In this 

proposed example, the plan generally 

covers the full range of outpatient 

treatments and treatment settings, 

including primary treatments, for 

medical conditions and surgical 

procedures when provided on an out-ofnetwork basis. The proposed example 

concluded that the plan violates the 

proposed meaningful benefits standard 

because, by not providing benefits for 

ABA therapy, it fails to provide 

meaningful benefits for ASD in the 

outpatient, out-of-network 

classification, but generally covers the 

full range of medical/surgical benefits in 

the classification. 

In proposed Example 6, a plan 

generally covers diagnosis and 

treatment for eating disorders, a mental 

health condition, but specifically 

excludes coverage for nutrition 

counseling to treat eating disorders, 

including in the outpatient, in-network 

classification. The example in the 

proposed rules noted that nutrition 

counseling is the primary treatment for 

eating disorders in the outpatient, innetwork classification and stated that 

the plan generally provides benefits for 

the primary treatments for medical 

conditions and surgical procedures in 

the outpatient, in-network classification. 

The proposed example concluded that 

the plan violates the proposed 

meaningful benefits standard because, 

by not providing benefits for nutrition 

counseling, it fails to provide 

meaningful benefits for the treatment of 

eating disorders in the outpatient, innetwork classification, as determined in 

comparison to the benefits provided for 

medical/surgical conditions in the 

classification. The Departments noted 

that, if the plan covers medical/surgical 

benefits for nutrition counseling, the 

plan would also violate the prohibition 

on separate NQTLs applicable only to 

mental health or substance use disorder 

benefits. 

Several commenters generally 

expressed support for the proposed 

Examples 5 and 6, which illustrated 

clear instances where exclusions of key 

services for ASD and eating disorders 

violate MHPAEA, noting that these 

examples remove any ambiguity 

whether such exclusions are 

inconsistent with MHPAEA’s 

requirements. One commenter 

expressed concerns about references to 

ABA therapy specifically because 

referring to a specific treatment may be 

limiting as evidence evolves regarding 

ASD. This commenter also cited a 

relatively weak evidence base for ABA 

therapy as a reason why the example 

should not specifically reference ABA 

therapy. Another commenter requested 

that Example 6 define ‘‘primary 

treatments’’ and ‘‘meaningful benefits’’ 

based on independent medical and 

clinical guidelines. A few commenters 

suggested that the Departments use the 

term ‘‘medical nutrition therapy’’ 

instead of nutrition counseling, to better 

reflect the clinical term used in 

treatment codes. Another commenter 

suggested providing an additional 

example related to the treatment of 

OUD, to reinforce the clear requirement 

to cover opioid treatment program 

services as part of the ‘‘meaningful’’ 

coverage of substance use disorder 

benefits in all classifications in which 

meaningful medical/surgical services 

are covered. 

After considering comments, the 

Departments are finalizing Examples 5 

and 6 in the proposed rules with 

modifications, to make the examples 

consistent with the clarifications 

described earlier in this preamble 

stating that a plan or issuer will be 

required to provide meaningful benefits 

for a mental health condition or 

substance use disorder in a 

classification if it provides meaningful 

benefits for one or more medical 

conditions or surgical procedures in the 

same classification. These final rules 

also make minor clarifying changes to 

reflect more appropriate clinical 

terminology and introduce two new, 

additional examples. In each example in 

these final rules that illustrates the 

meaningful benefits standard, the group 

health plan is subject to the 

requirements of MHPAEA and provides 

both medical/surgical benefits and 

mental health and substance use 

disorder benefits. Additionally, these 

final rules note that references in these 

examples to any particular core 

treatment are included for illustrative 

purposes only and are not intended to 

limit coverage in any way. The 

Departments remind plans and issuers 

that they must consult generally 

recognized independent standards of 

current medical practice to determine 

the applicable core treatment, therapy, 

service, or intervention for any covered 

condition or disorder, and note that, as 

medical evidence evolves, the core 

treatment options for any condition or 

disorder may change. 

In Example 5 of these final rules, a 

plan covers treatment for ASD. As 

explained earlier in this preamble and 

in the proposed rules, for purposes of 

MHPAEA, ASD is a mental health 

condition under generally recognized 

independent standards of current 

medical practice.107 Specifically, the 

plan covers outpatient, out-of-network 

developmental screenings for ASD, but 

excludes all other benefits for outpatient 

treatment for ASD, including ABA 

therapy, when provided on an out-ofnetwork basis. The plan generally 

covers the full range of outpatient 

treatments (including core treatments) 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77637 

108As discussed earlier in this preamble, the 

Departments note that this conclusion would hold 

if the plan provides benefits for a core treatment for 

a medical/surgical condition in the outpatient, outof-network classification, solely to meet 

requirements under the provisions of the No 

Surprises Act. 

109For example, if the plan excludes coverage for 

ABA therapy and the exclusion does not comply 

with the provisions applicable to NQTLs under the 

final rules—including the design and application 

requirements and the relevant data evaluation 

requirements (if the exclusion was generated 

through a broader NQTL such as medical necessity 

or other clinical guideline that also applies to 

medical/surgical benefits in the relevant 

classification), or the requirement that there are no 

separate NQTLs that apply only to mental health or 

substance use disorder benefits in a classification— 

the plan violates the rules of 26 CFR 54.9812– 

1(c)(4), 29 CFR 2590.712(c)(4), and 45 CFR 

146.136(c)(4). 

110The proposed rules and these final rules refer 

to benefits for ‘‘nutrition counseling.’’ The 

Departments acknowledge several commenters who 

noted that other terminology may be more 

appropriate, such as ‘‘medical nutrition therapy’’ or 

‘‘medical nutrition therapy provided by a dietitian’’ 

using specific CPT codes. The Departments intend 

that references to nutritional counseling for eating 

disorders be interpreted broadly to include these 

and other appropriate types of treatment for eating 

disorders. 

and treatment settings for medical 

conditions and surgical procedures 

when provided on an out-of-network 

basis. Under the generally recognized 

independent standards of current 

medical practice consulted by the plan, 

developmental screenings alone that are 

covered for diagnostic purposes, 

without any coverage for a therapeutic 

intervention, do not constitute a core 

treatment for ASD. Example 5 concludes 

that the plan violates these final rules. 

Although the plan covers benefits for 

ASD, in the outpatient, out-of-network 

classification, it only covers 

developmental screenings, so it does not 

cover a core treatment for ASD in the 

classification. Since the plan generally 

covers the full range of medical/surgical 

benefits including a core treatment for 

one or more medical conditions or 

surgical procedures in the classification, 

it fails to provide meaningful benefits 

for treatment of ASD in the 

classification, as required under these 

final rules. 

New Example 6 of these final rules 

starts with the same facts as Example 5 

and illustrates how these final rules 

apply where a plan or issuer does not 

cover a core treatment for any medical 

conditions or surgical procedures in a 

classification. The facts of new Example 

6 state that the plan is a health 

maintenance organization (HMO) that 

does not cover the full range of medical/ 

surgical benefits, including a core 

treatment for any medical conditions or 

surgical procedures in the outpatient, 

out-of-network classification (except as 

required under Code sections 9816 and 

9817, ERISA sections 716 and 717, and 

PHS Act sections 2799A–1 and 2799A– 

2), but covers benefits for medical 

conditions and surgical procedures in 

the inpatient, in-network; outpatient, innetwork; emergency care, and 

prescription drug classifications. 

Example 6 concludes that the plan does 

not violate the rules in 26 CFR 54.9812– 

1(c)(2)(ii), 29 CFR 2590.712(c)(2)(ii), and 

45 CFR 146.136(c)(2)(ii). Because the 

plan does not provide meaningful 

benefits including a core treatment for 

any medical condition or surgical 

procedure in the outpatient, out-ofnetwork classification (except as 

required under Code sections 9816 and 

9817, ERISA sections 716 and 717, and 

PHS Act sections 2799A–1 and 2799A– 

2), the plan is not required to provide 

meaningful benefits, for any mental 

health conditions or substance use 

disorders in that classification.108 The 

Departments note that, nevertheless, the 

plan must provide meaningful benefits 

for each mental health condition and 

substance use disorder for which the 

plan provides benefits in every 

classification in which meaningful 

medical/surgical benefits are provided. 

Additionally, the Departments note that 

plans and issuers must comply with 

other requirements of these final rules, 

as applicable, including the prohibition 

on NQTLs applicable only to mental 

health and substance use disorder 

benefits.109

In Example 7 of these final rules, 

which was redesignated from Example 6 

in the proposed rules, a plan provides 

extensive benefits, including for core 

treatments for many medical conditions 

and surgical procedures in the 

outpatient, in-network classification, 

including nutrition counseling for 

diabetes and obesity. The plan also 

generally covers diagnosis and 

treatment for eating disorders, which are 

mental health conditions, including 

coverage for nutrition counseling 110 to 

treat eating disorders in the outpatient, 

in-network classification. Under this 

example, nutrition counseling is a core 

treatment for eating disorders, in 

accordance with generally recognized 

independent standards of current 

medical practice consulted by the plan. 

Example 7 concludes that the plan does 

not violate the meaningful benefits 

standard in these final rules. The 

coverage of diagnosis and treatment for 

eating disorders, including nutrition 

counseling, in the outpatient, innetwork classification results in the 

plan providing meaningful benefits for 

the treatment of eating disorders in the 

classification, as determined in 

comparison to the benefits provided for 

medical conditions and surgical 

procedures in the classification. 

In response to commenters who 

requested an additional example 

illustrating what plans and issuers must 

do to provide meaningful benefits for 

the treatment of OUD, the Departments 

are also finalizing new Example 8. In 

this new example, a plan provides 

extensive benefits for the core 

treatments for many medical conditions 

and surgical procedures in the 

outpatient, in-network and prescription 

drug classifications. The plan provides 

coverage for diagnosis and treatment for 

OUD, a substance use disorder, in the 

outpatient, in-network classification, by 

covering counseling and behavioral 

therapies, also referred to as 

psychosocial treatments. Additionally, 

the plan provides coverage for diagnosis 

and treatment for OUD, in the 

prescription drug classification, by 

covering medications to treat opioid use 

disorder (MOUD). Under this example, 

counseling and behavioral therapies and 

MOUD, in combination, are one of the 

core treatments for OUD, in accordance 

with generally recognized independent 

standards of current medical practice 

consulted by the plan. 

Example 8 concludes that the plan 

does not violate these final rules. The 

coverage of counseling and behavioral 

therapies and MOUD, in combination, 

in the outpatient, in-network 

classification and prescription drug 

classification, respectively, results in 

the plan providing meaningful benefits 

for the treatment of OUD in the 

outpatient, in-network and prescription 

drug classifications. 

b. Classification of Benefits 

The 2013 final regulations set forth 

the only classifications of benefits that 

may be used in applying the parity rules 

for financial requirements and treatment 

limitations and listed specific instances 

when a plan or issuer may divide 

benefits into sub-classifications beyond 

the six classifications permitted in 

paragraph (c)(2)(ii)(A) of the 2013 final 

regulations. The Departments proposed 

to reiterate at 26 CFR 54.9812– 

1(c)(3)(iii), 29 CFR 2590.712(c)(3)(iii), 

and 45 CFR 146.136(c)(3)(iii) that a plan 

or issuer may not divide benefits into 

any sub-classifications other than those 

specifically permitted under the 

regulations. The Departments did not 

propose any substantive changes to the 

existing sub-classifications or to permit 

any new sub-classifications. The 

Departments also proposed nonsubstantive changes to 26 CFR 54.9812– 

1(c)(3)(iv), 29 CFR 2590.712(c)(3)(iv), 

and 45 CFR 146.136(c)(3)(iv) to label the 


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111 26 CFR 54.9812–1(c)(3)(iii), 29 CFR 

2590.712(c)(3)(iii), and 45 CFR 146.136(c)(3)(iii). 

112 26 CFR 54.9812–1(c)(2)(ii)(A), 29 CFR 

2590.712(c)(2)(ii)(A), and 45 CFR 

146.136(c)(2)(ii)(A). 

tables in the examples, update 

references in the examples, and 

redesignate the examples as paragraphs. 

A few commenters expressed 

concerns about the classification of 

certain types of benefits and providers 

into existing classifications and subclassifications, including intensive 

outpatient treatment, partial 

hospitalization programs, and other 

team-based models of care. Some 

commenters requested additional 

clarification, including a standard 

definition for the outpatient subclassifications, citing the fact that some 

plans and issuers use differing 

variations to define the outpatient, 

office visit sub-classification. One 

commenter requested that the 

Departments indicate that the subclassifications applicable to financial 

requirements and quantitative treatment 

limitations under paragraph (c)(3)(iii) of 

the 2013 final regulations may also be 

used for NQTLs. 

As discussed earlier in this preamble, 

plans and issuers must assign covered 

intermediate mental health and 

substance use disorder benefits to the 

existing six benefit classifications in the 

same way that they assign comparable 

intermediate medical/surgical benefits 

to these classifications. Additionally, 

plans and issuers that opt to use subclassifications for outpatient benefits 

must assign covered outpatient benefits 

to the permissible outpatient subclassifications for mental health and 

substance use disorder benefits in the 

same way they assign comparable 

medical/surgical benefits. The 

Departments are finalizing the 

clarification that a plan or issuer is not 

permitted to divide benefits into any 

sub-classifications other than those 

specifically permitted under the 

regulations,111 as well as the 

clarification that plans and issuers may 

use the permissible sub-classifications 

under the 2013 final regulations when 

applying all of the rules for financial 

requirements and treatment limitations, 

including NQTLs.112 Consistent with 

the proposed rules, the Departments are 

not making any substantive changes to 

the existing sub-classifications or to 

permit any new sub-classifications of 

benefits in these final rules. The 

Departments are also finalizing the nonsubstantive changes to 26 CFR 54.9812– 

1(c)(3)(iv), 29 CFR 2590.712(c)(3)(iv), 

and 45 CFR 146.136(c)(3)(iv), for which 

no comments were received. 

The Departments noted in the 

preamble to the proposed rules that they 

have received questions and requests for 

guidance on how to comply with 

MHPAEA’s requirements with respect to 

telehealth benefits, including where 

telehealth fits into the existing 

classifications and sub-classifications of 

benefits and whether changes are 

necessary to account for telehealth 

benefits. The Departments did not 

propose any changes in the proposed 

rules with respect to telehealth benefits 

and instead stated that they expected 

plans and issuers to treat telehealth 

benefits the same way they treat those 

benefits when provided in person in 

determining the classification or subclassifications in which a particular 

benefit belongs. The Departments 

requested comments on whether 

changes to the framework and existing 

regulations implementing MHPAEA 

were necessary to account for telehealth 

benefits. 

Several commenters stated that the 

expansion of telehealth services can 

supplement a plan’s or issuer’s network 

where there are in-person provider 

shortages and expressed support for 

treating telehealth benefits the same 

way those benefits are treated when 

provided in person. Some commenters 

discussed the growth and sustained 

usage of telehealth services since the 

start of the COVID–19 pandemic, 

particularly for mental health and 

substance use disorder services. 

Commenters stressed that telehealth is 

particularly valuable in rural and 

medically underserved areas. However, 

commenters stressed that telehealth may 

not be appropriate for all patients and 

does not fully replace in-person mental 

health and substance use disorder care. 

The Departments reiterate that plans 

and issuers are expected to treat 

telehealth benefits the same way they 

treat those benefits when provided in 

person in determining the classification 

or sub-classifications in which a 

particular benefit belongs. 

As discussed earlier in the preamble, 

several commenters requested the 

Departments take into account 

telehealth in the relevant data 

evaluation requirements, as well as the 

requirements for standards related to 

network composition; however, the 

Departments are not addressing any 

specific data metrics for telehealth in 

these final rules. After reviewing the 

comments received on this issue, the 

Departments are not making changes in 

these final rules to address how to 

classify telehealth benefits. The 

Departments understand that telehealth 

plays a vital role in the provision of 

health care, particularly following the 

COVID–19 pandemic, and may support 

access to services for those with 

transportation barriers. When evaluating 

MHPAEA compliance, plans and issuers 

must include any covered telehealth 

benefits in the six classifications used to 

apply the parity requirements. The 

Departments also understand that 

telehealth can be used by plans and 

issuers as a tool to address provider 

shortages. These final rules also 

acknowledge telehealth can be 

leveraged to mitigate provider shortages 

in a geographic area and that leveraging 

telehealth is a potential reasonable 

action that can be used to address 

material differences in in-network 

access. 

c. Availability of Plan Information 

Treasury and DOL proposed to amend 

26 CFR 54.9812–1(d)(3) and 29 CFR 

2590.712(d)(3) by adding crossreferences to proposed 26 CFR 54.9812– 

2 and 29 CFR 2590.712–1 to clarify that 

the comparative analyses and any other 

applicable information required under 

the CAA, 2021 are considered to be 

instruments under which a plan is 

established or operated, and therefore 

ERISA plans generally must furnish 

those documents to plan participants 

and beneficiaries upon request within 

30 days, as required under section 104 

of ERISA and 29 CFR 2520.104b-1. 

Additionally, the Departments proposed 

to amend 26 CFR 54.9812–1(d)(3), 29 

CFR 2590.712(d)(3), and 45 CFR 

146.136(d)(3) to clarify that the 

comparative analyses and any other 

applicable information required under 

the CAA, 2021 and the proposed rules 

qualify as documents, records, and other 

information relevant to the claimant’s 

claim for benefits to which plans and 

issuers must provide reasonable access 

upon request and free of charge. The 

Departments noted that this clarification 

is consistent with proposed 26 CFR 

54.9812–2(e)(2), 29 CFR 2590.712– 

1(e)(2), and 45 CFR 146.137(e)(2), which 

generally would require plans and 

issuers to make available the 

comparative analyses required to be 

performed and documented under the 

CAA, 2021 when requested by 

participants and beneficiaries in ERISA 

plans, including when requested by a 

participant or beneficiary (or a provider 

or other person acting as a participant’s 

or beneficiary’s authorized 

representative) who has received an 

adverse benefit determination related to 

mental health or substance use disorder 

benefits. The Departments noted in the 

preamble to the proposed rules that 

participants and beneficiaries in ERISA 

plans should be able to request copies 

of comparative analyses to ensure they 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77639 

113Patient Protection and Affordable Care Act; 

Updating Payment Parameters, Section 1332 Waiver 

Implementing Regulations, and Improving Health 

Insurance Markets for 2022 and Beyond, 86 FR 

53412 (Sept. 27, 2021), https://www.federal

register.gov/documents/2021/09/27/2021-20509/ 

patient-protection-and-affordable-care-actupdating-payment-parameters-section-1332-waiver. 

are informed about their health plans or 

group health insurance coverage. 

Additionally, the Departments noted 

that these comparative analyses would 

be relevant to a claimant’s claim for 

benefits and should therefore be 

available to participants or beneficiaries, 

and providers or other individuals 

acting as a participant’s or beneficiary’s 

authorized representative. 

The Departments received several 

comments on this aspect of the 

proposed rules. A few commenters 

recommended that the Departments add 

language to the end of paragraph (d)(3) 

of 26 CFR 54.9812–1, 29 CFR 2590.712, 

and 45 CFR 146.136 making clear that 

no part of the comparative analyses or 

other applicable information required 

by 26 CFR 54.9812–2, 29 CFR 2590.712– 

1, or 45 CFR 146.137 may be withheld 

when requested, including because the 

information is proprietary, has 

commercial value, or is commercially 

protected. One of these commenters also 

urged the Departments to conform this 

provision with the standard proposed in 

26 CFR 54.9812–2(e), 29 CFR 2590.712– 

1(e), and 45 CFR 146.137(e), so that 

individuals can have information at the 

time of the denial, which is needed to 

assess whether to raise a parity 

compliance claim in an internal 

grievance or appeal. 

After considering comments, the 

Departments are finalizing the 

amendments to 26 CFR 54.9812–1(d)(3), 

29 CFR 2590.712(d)(3), and 45 CFR 

146.136(d)(3) as proposed, with a 

correction. The final rules remove the 

phrase ‘‘upon appeal of an adverse 

benefit determination’’ and replace it 

with ‘‘who have received an adverse 

benefit determination’’ in the third 

sentence of 26 CFR 54.9812–1(d)(3), 29 

CFR 2590.712(d)(3), and 45 CFR 

146.136(d)(3) to conform with the 

requirements under the DOL claims 

procedure rule at 29 CFR 2560.503–1 

and rules issued by the Departments at 

26 CFR 54.9815–2719, 29 CFR 

2590.715–2719, and 45 CFR 147.136, 

which set forth rules regarding claims 

and appeals. The Departments also 

decline to exempt plans and issuers 

from providing certain types of 

information as part of their comparative 

analyses, to ensure transparency when 

an individual (or their authorized 

representative) requests a comparative 

analysis. As stated earlier in this 

preamble, this information is relevant to 

a claimant’s claim for benefits and 

should therefore be made available. 

d. Other Provisions 

The proposed rules included 

proposed amendments to 26 CFR 

54.9812–1(e)(4), 29 CFR 2590.712(e)(4), 

and 45 CFR 146.136(e)(4) to include a 

reference to 26 CFR 54.9812–2(g), 29 

CFR 2590.712–1(g), and 45 CFR 

146.137(g) and to reflect current HHS 

regulations at 45 CFR 156.115(a)(3). The 

preamble to the proposed rules noted 

that existing regulations at 26 CFR 

54.9812–1(e)(4), 29 CFR 2590.712(e)(4), 

and 45 CFR 146.136(e)(4) state that 

nothing in paragraphs (f) and (g) of the 

2013 final regulations related to 

MHPAEA’s small employer exemption 

and increased cost exemption, 

respectively, changes the requirement 

under HHS regulations at 45 CFR 

147.150 and 156.115, providing that a 

health insurance issuer offering nongrandfathered health insurance coverage 

in the individual or small group market 

providing mental health and substance 

use disorder services, including 

behavioral health treatment services, 

must comply with the provisions of 45 

CFR 146.136 to satisfy the requirement 

to provide EHB. The preamble further 

stated that HHS has updated 45 CFR 

156.115(a)(3) to state that provision of 

EHB means that a health plan provides 

benefits that ‘‘[w]ith respect to the 

mental health and substance use 

disorder services, including behavioral 

health treatment services, required 

under § 156.110(a)(5), comply with the 

requirements under section 2726 of the 

Public Health Service Act and its 

implementing regulations.’’ 113 The 

Departments did not receive comments 

on this provision. Therefore, to be 

consistent with the language contained 

in 45 CFR 156.115(a)(3), and to ensure 

that the cross-reference between the 

Departments’ MHPAEA implementing 

regulations and HHS’ EHB 

implementing regulations includes the 

requirement to comply with the 

provisions on comparative analyses, the 

Departments are finalizing this change 

as proposed with minor edits for 

precision, and to reflect that the 

requirement would only apply to a 

health insurance issuer offering nongrandfathered health insurance coverage 

in the individual or small group market 

that is required to provide mental health 

and substance use disorder services, 

including behavioral health treatment 

services, as part of EHB required under 

45 CFR 156.110(a)(5) and 156.115(a). 

The proposed rules also included 

several technical edits to update 

paragraph (c)(3)(i) of the 2013 final 

regulations to add citations, include 

additional specificity in citations, and 

strike an outdated reference to 

limitations on annual deductibles for 

non-grandfathered health plans in the 

small group market at PHS Act section 

2707(b) and ACA section 1302(c). The 

Departments did not receive any 

comments on these provisions and are 

finalizing as proposed. 

The Departments are finalizing 

proposed technical amendments to 26 

CFR 54.9812–1(c)(3)(iii)(A) and (B), 29 

CFR 2590.712(c)(3)(iii)(A) and (B), and 

45 CFR 146.136(c)(3)(iii)(A) and (B) to 

update citations. No comments were 

received on these technical 

amendments. In finalizing these 

provisions, the Departments are also 

restoring parenthetical references to 

health insurance coverage. Re-insertion 

of the phrase ‘‘health insurance 

coverage’’ is not intended to be a 

substantive change from the proposed 

rules, but rather corrects this omission 

and is consistent with the text of the 

2013 final regulations. 

B. New Regulations at 26 CFR 54.9812– 

2, 29 CFR 2590.712–1, and 45 CFR 

146.137 

The CAA, 2021 amended MHPAEA, 

in part, to expressly require plans and 

issuers that offer coverage that provides 

both medical/surgical benefits and 

mental health or substance use disorder 

benefits and impose NQTLs on mental 

health or substance use disorder 

benefits to perform and document 

comparative analyses of the design and 

application of NQTLs, and make their 

comparative analyses and certain 

information available to the 

Departments or applicable State 

authorities upon request. The 

Departments proposed to codify this 

requirement. 

Many commenters expressed support 

for codification of this requirement with 

several of these commenters noting that 

such detailed requirements are 

necessary to clarify what plans’ or 

issuers’ analyses must contain, as well 

as to hold plans and issuers accountable 

in following such requirements. 

Many other commenters criticized the 

proposed content elements and 

requested specific changes to the rules 

as proposed to assist plans and issuers 

in complying with the requirement to 

perform and document comparative 

analyses. Several commenters requested 

examples of a compliant comparative 

analysis to assist in understanding what 

documentation, in the Departments’ 

view, is required to meet the standards. 

Another commenter stated that critical 

components of the terms, such as what 

a test comprises, the standards for 


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meeting that test, and compiling the 

proper information are subject to 

interpretation, which can lead to 

regulators and auditors having different 

perspectives on the requirements, 

creating substantial uncertainty for 

plans and issuers that are attempting to 

comply. Several commenters also 

expressed a desire for additional 

clarification regarding the proposed 

content elements with respect to 

specific NQTLs. One commenter was 

concerned that the proposed rules did 

not provide clarity on how to apply the 

new comparative analysis requirements 

to complex NQTLs, such as those 

related to network administration. 

After reviewing comments, the 

Departments are finalizing the 

codification of the new statutory 

requirement that plans and issuers that 

offer coverage that provides both 

medical/surgical benefits and mental 

health or substance use disorder 

benefits and impose NQTLs on mental 

health or substance use disorder 

benefits must perform and document a 

comparative analysis of the design and 

application of each such NQTL, with 

modifications in response to comments 

as noted. This finalized provision aligns 

the regulations with the statutory 

requirements under MHPAEA, as 

amended by the CAA, 2021. In response 

to commenter concerns that the 

proposed rules did not clarify how a 

plan or issuer should apply the new 

comparative analysis requirements to 

factors and evidentiary standards used 

to design and apply NQTLs that are 

especially complex (including those 

related to network composition), the 

Departments disagree that the proposed 

rules and these final rules do not 

rationally relate to factors and 

evidentiary standards used to design 

and apply NQTLs like standards related 

to network composition or methods for 

determining out-of-network rates. Using 

the definitions of the terms ‘‘processes,’’ 

‘‘strategies,’’ ‘‘evidentiary standards,’’ 

and ‘‘factors’’ under these final rules to 

inform the content elements required in 

a comparative analysis, these final rules 

provide sufficient guidance for plans 

and issuers to perform and document 

their comparative analyses of all 

NQTLs. 

Additionally, these final rules also 

provide additional guidance on how a 

plan or issuer with a typical plan or 

coverage design should collect and 

evaluate data for NQTLs related to 

network composition (which must be 

included in the comparative analysis) 

under the relevant data evaluation 

requirements, and provides examples of 

reasonable actions that plans and 

issuers may take (and document in the 

comparative analysis) if such data 

suggest that NQTLs related to network 

composition contribute to material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits 

in a classification. The Departments 

acknowledge that a plan or issuer 

imposing a complex NQTL with respect 

to mental health and substance use 

disorder benefits by relying on a large 

number of complicated factors and 

evidentiary standards will likely require 

more resources to perform and 

document their comparative analysis in 

a manner that is compliant with these 

final rules. The Departments also 

appreciate that some of the required 

content for comparative analyses are 

described broadly and therefore could 

lead to the Departments and applicable 

State authorities taking different 

approaches in determining what 

constitutes a sufficient comparative 

analysis. However, these broad 

descriptions are necessary to ensure that 

these final rules set forth a single set of 

content elements that are flexible 

enough to apply to the wide variety of 

different NQTLs imposed by plans and 

issuers with respect to mental health 

and substance use disorder benefits. 

The Departments are not providing an 

example of a comparative analysis that 

complies with these final rules, but 

continue to consider what additional 

resources and guidance are necessary to 

assist the regulated community in 

complying with MHPAEA and these 

final rules. A plan or issuer that 

analyzes the design and application of 

an NQTL along with the relevant data 

and considers it in the manner 

described earlier in this preamble will 

be well positioned to perform and 

document a comparative analysis in a 

manner consistent with these final 

rules. The Departments also note, as 

stated earlier in this preamble, that they 

intend to update the MHPAEA SelfCompliance Tool for plans and issuers 

to determine which data to collect and 

evaluate. The Departments note that 

what constitutes a compliant 

comparative analysis will depend on all 

the relevant facts and circumstances, 

including the provisions of the plan or 

coverage and the relevant NQTL. The 

Departments remain committed to 

providing additional guidance to assist 

with the implementation of these final 

rules. 

1. Content of Comparative Analyses—26 

CFR 54.9812–2(c), 29 CFR 2590.712– 

1(c), and 45 CFR 146.137(c) 

The Departments proposed 

requirements at 26 CFR 54.9812–2(c), 29 

CFR 2590.712–1(c), and 45 CFR 

146.137(c) governing the content of the 

comparative analyses required by Code 

section 9812(a)(8), ERISA section 

712(a)(8), and PHS Act section 

2726(a)(8). Specifically, the 

Departments proposed that each 

comparative analysis would include, at 

a minimum, with respect to each NQTL 

imposed under the plan or coverage on 

mental health and substance use 

disorder benefits, six elements: 

(1) a description of the NQTL; 

(2) the identification and definition of 

the factors used to design or apply the 

NQTL; 

(3) a description of how factors are 

used in the design or application of the 

NQTL; 

(4) a demonstration of comparability 

and stringency, as written; 

(5) a demonstration of comparability 

and stringency, in operation; and 

(6) findings and conclusions. 

In addition to proposing to require the 

inclusion of specific elements in each 

comparative analysis, the proposed 

rules would require each plan or issuer 

to prepare and make available to the 

Departments, upon request, a written 

list of all NQTLs imposed under the 

plan or coverage and a general 

description of any information 

considered or relied upon by the plan or 

issuer in preparing the comparative 

analysis for each NQTL. 

Several commenters expressed 

general support for the proposed 

elements that plans and issuers would 

be required to include in their 

comparative analyses under the 

proposed rules. Some commenters 

highlighted that the clarity the proposed 

rules provided would help to reduce 

confusion as to how plans and issuers 

should perform and document their 

comparative analyses, and others 

reasoned that, by clarifying the 

comparative analysis content 

requirements under the proposed rules, 

regulators will be able to better 

determine compliance with MHPAEA. 

Some commenters, however, stated 

that the proposed rules did not provide 

enough clarity, which they stated may 

make complying with the requirements 

more challenging. These commenters 

stated that providing a list of all NQTLs 

imposed under a plan or coverage 

would be challenging without either a 

definitive list of all NQTLs or requiring 

that plans and issuers perform and 

document comparative analyses only for 

NQTL types that the Departments define 

through regulations or guidance. As 

discussed earlier in the preamble, 

several commenters requested that the 

Departments provide an exhaustive list 

of NQTLs for which a comparative 

analysis would be required. 


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Commenters also expressed concerns 

about whether plans and issuers would 

be able to access the information and 

data necessary to perform and document 

a sufficient comparative analysis that 

includes all of the proposed content 

requirements. Several of these 

commenters mentioned difficulty 

acquiring the necessary information and 

data from their service providers and 

business partners, while other 

commenters stated that the proposed 

content requirements for comparative 

analyses are superfluous, unhelpful, or 

unreasonably burdensome. Some 

commenters described concerns related 

to cost and feasibility of preparing 

comparative analyses that would 

comply with the proposed content 

requirements. 

After reviewing comments, the 

Departments are finalizing the 

requirement that a comparative analysis 

include, at a minimum, the six content 

elements listed in the proposed rules, 

consistent with the statute, with several 

modifications. This section of the 

preamble to these final rules discusses 

the comments received with respect to 

each content element in the proposed 

rules and the modifications made to 

each content element in these final 

rules. 

With respect to the requirement to 

prepare and make available, upon 

request, a written list of all NQTLs 

imposed under the plan or coverage and 

commenters who noted that this 

requirement would be challenging to 

meet without a definitive list of all 

NQTLs, as stated earlier in this 

preamble, the Departments decline to 

provide an exhaustive list of NQTLs in 

these final rules or separate guidance. 

The Departments also note that, like the 

substantive requirements for NQTLs, the 

comparative analysis requirements of 

MHPAEA are not limited to a list of 

specific NQTLs, but apply to all NQTLs 

that limit the scope or duration of 

treatment under a plan or coverage. As 

a result, these final rules require that, in 

addition to the comparative analysis for 

each NQTL, each plan or issuer must 

prepare and make available to the 

Secretary, upon request, a written list of 

all NQTLs imposed under the plan or 

coverage. 

Additionally, for ERISA-covered 

plans, the written list must be provided 

to the named fiduciaries of the plan who 

are required to include a certification as 

part of each comparative analysis, as 

discussed later in this preamble. 

However, because the Departments 

recognize that a sufficient comparative 

analysis will include descriptions of the 

information, evidence, sources, and 

standards, as well as factors and 

evidentiary standards, that the plan or 

issuer considered or relied upon as part 

of the content elements, these final rules 

eliminate the separate requirement that 

proposed to require plans and issuers to 

provide a general description of any 

information considered or relied upon 

by the plan or issuer in preparing a 

comparative analysis for an NQTL. 

The Departments are aware of reports 

that some self-insured plans have been 

unsuccessful in receiving comparative 

analyses (or the information required to 

perform and document comparative 

analyses) requested from their TPAs or 

other service providers. The 

Departments emphasize that, as of the 

date of the publication of these final 

rules, the statutory requirement to 

perform and document comparative 

analyses has been applicable to plans 

and issuers for over 3 years. The 

Departments have previously stated that 

TPAs and other service providers are 

expected to work closely with plans and 

issuers to support their needs by 

providing data and other information 

about the design and application of 

NQTLs applicable to mental health and 

substance use disorder benefits and to 

medical/surgical benefits so that 

comparative analyses can be performed 

and documented (regardless of whether 

the Departments or an applicable State 

authority have requested them). Because 

plans and issuers are the entities 

required by statute to perform and 

document comparative analyses and 

there is no exception to the requirement 

when necessary information cannot be 

obtained from another entity, plans and 

issuers must work with their TPAs and 

service providers to obtain the 

information they need for their 

comparative analyses. Any ERISAgoverned group health plans that 

contract with service providers refusing 

or otherwise failing to provide the 

requisite information should notify 

DOL. 

Additionally, as noted earlier in this 

preamble, the Departments acknowledge 

the challenges, cost, and complexity of 

collecting and evaluating data, but are of 

the view that it is important to include 

specific content requirements in these 

final rules, including those related to 

relevant data to measure the impact of 

an NQTL on access to mental health and 

substance use disorder benefits. 

However, in recognition of these 

challenges and to align with other 

changes made in these final rules the 

Departments have modified certain 

specific provisions within some of the 

listed content elements as described in 

the following paragraphs. 

a. Description of the NQTL 

For each comparative analysis, the 

proposed rules would require a plan or 

issuer to identify the NQTL that is the 

subject of the comparative analysis, 

including the specific terms of the plan 

or coverage or other relevant terms 

regarding the NQTL, the policies or 

guidelines (internal or external) in 

which the NQTL appears or is 

described, and the applicable sections of 

any other relevant documents, such as 

provider contracts that describe the 

NQTL, consistent with the statute. This 

would include the documents that 

contain the specific language of the 

NQTL that the plan or issuer imposes. 

The plan or issuer would also be 

required to identify all mental health or 

substance use disorder benefits and 

medical/surgical benefits to which the 

NQTL applies, including a list 

identifying which of those benefits are 

considered to be mental health and 

substance use disorder benefits and 

which benefits are considered to be 

medical/surgical benefits (consistent 

with the proposed definitions of those 

terms). Additionally, each plan or issuer 

would be required to include in its 

comparative analysis a description of 

which benefits are included in each 

classification of benefits. Finally, under 

the proposed rules, the plan or issuer 

would be required to identify the 

predominant NQTL applicable to 

substantially all medical/surgical 

benefits in each classification, including 

an explanation of how the plan or issuer 

determined which variation is the 

predominant NQTL and how the plan 

identified the variations of the NQTL. 

The Departments received few 

comments on this proposed first content 

element. One commenter suggested an 

alternative approach, arguing that, 

instead of requiring that plans and 

issuers provide all policies, guidelines, 

provider contracts, and any other 

documents where the NQTL ‘‘appears or 

is described,’’ plans and issuers should 

be required under these final rules to 

provide only the documents, policies, or 

procedures that govern the NQTL. 

After reviewing comments, the 

Departments are finalizing the 

requirement that a comparative analysis 

include a description that identifies the 

NQTL, identifies all mental health or 

substance use disorder benefits and 

medical/surgical benefits to which the 

NQTL applies, and describes which 

benefits are included in each 

classification. The Departments 

emphasize that these final rules still 

require a plan or issuer to identify the 

specific terms of the plan or coverage or 

other relevant terms regarding the 


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77642 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

114However, as discussed earlier in this 

preamble, the Departments are of the view that the 

concept of material differences in access helps to 

give meaning to the concepts of ‘‘substantially all’’ 

and ‘‘predominant’’ from the statutory language in 

the context of NQTLs. 

115Code section 9812(a)(8)(A)(iii), ERISA section 

712(a)(8)(A)(iii), and PHS Act section 

2726(a)(8)(A)(iii). 

116https://www.dol.gov/sites/dolgov/files/EBSA/ 

about-ebsa/our-activities/resource-center/faqs/acapart-45.pdf and https://www.cms.gov/cciio/ 

resources/fact-sheets-and-faqs/downloads/mhpaeafaqs-part-45.pdf. Additionally, the 2020 MHPAEA 

Self-Compliance Tool includes robust guidance 

related to requirements for NQTLs. Step two of the 

analysis outlined in the 2020 MHPAEA SelfCompliance Tool for NQTLs suggests identifying 

the factors considered in the design of the NQTL. 

See EBSA, Self-Compliance Tool for the Mental 

Health Parity and Addiction Equity Act (MHPAEA) 

(2020), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/laws/mental-healthparity/self-compliance-tool.pdf. 

NQTL, including the policies or 

guidelines (internal or external) in 

which the NQTL appears or is described 

and the applicable sections of any other 

relevant documents, such as provider 

contracts, that describe the NQTL. 

Under these final rules, the entire 

policy, guideline, or document is not 

required to be included in a 

comparative analysis, but could be 

requested by the Departments in the 

course of reviewing a comparative 

analysis. The Departments decline to 

require the inclusion of only the 

documents that govern the NQTL, 

because that might not include all the 

policies or guidelines that determine 

how the NQTL is designed or applied 

with respect to mental health or 

substance use disorder benefits. 

Additionally, as noted earlier in these 

final rules, the Departments are not 

finalizing the proposed mathematical 

substantially all and predominant tests. 

Therefore, these final rules do not 

finalize the proposed content 

requirement that the description of the 

NQTL in a comparative analysis identify 

the predominant NQTL applicable to 

substantially all medical/surgical 

benefits in each classification, including 

an explanation of how the plan or issuer 

determined which variation is the 

predominant NQTL and how the plan or 

issuer identified the variations of the 

NQTL.114

b. Identification and Definition of the 

Factors and Evidentiary Standards Used 

To Design or Apply the NQTL 

Under the second proposed content 

element, a plan or issuer would be 

required to identify and define all of the 

factors considered or relied upon to 

design or apply the NQTL. The plan or 

issuer would be required to identify all 

of the factors considered, as well as the 

evidentiary standards considered or 

relied upon to design or apply each 

factor and the evidence or sources from 

which each evidentiary standard was 

derived, in determining which mental 

health or substance use disorder 

benefits and which medical/surgical 

benefits are subject to the NQTL. The 

plan or issuer would also be required to 

define each factor, by including a 

detailed description of the factor, and 

providing a description of each 

evidentiary standard (and the source of 

each evidentiary standard) identified. 

The Departments stressed in the 

preamble to the proposed rules that 

when identifying the evidence or 

sources from which an evidentiary 

standard is derived, a plan or issuer 

should be prepared to provide the 

copies of the actual evidence or source 

used, as well as the date and relevant 

citation for the correct version of the 

document used. 

The Departments received few 

comments on this content element. One 

commenter noted that the requirement 

to provide detailed descriptions of each 

factor, including evidence and sources 

relied upon with data and relevant 

citations, may be challenging for plans 

and issuers to operationalize. One 

commenter highlighted that it may be 

difficult to identify evidence and 

sources for factors that are processes, 

such as provider referral requirements, 

requirements to submit information for 

clinical review, or the development and 

approval of a treatment plan, and that 

processes used to apply the NQTL ‘‘in 

operation’’ should be analyzed under a 

separate step of the comparative 

analysis. Another commenter stated that 

the requirement to do a historical 

analysis of the factors utilized by plans 

and issuers, including dating and 

providing citations for sources (from the 

time they decided to impose the NQTL), 

would be burdensome, and 

recommended such a requirement be 

eliminated or that the Departments 

accept references to factors that are 

generally accepted business standards 

without the need for specific dates and 

citations. 

After reviewing comments, the 

Departments are finalizing the 

requirement that the comparative 

analysis identify and define all of the 

factors considered or relied upon to 

design or apply the NQTL to mental 

health or substance use disorder 

benefits and medical/surgical benefits as 

proposed, with minor non-substantive 

changes and a modification to align 

with changes made in these final rules 

to the prohibition on discriminatory 

factors and evidentiary standards. 

Specifically, these final rules clarify that 

a plan or issuer must identify every 

factor and the evidentiary standards 

considered or relied upon to design or 

apply each factor, instead of all of the 

factors considered, consistent with other 

provisions of these final rules. These 

final rules also add new 26 CFR 

54.9812–2(c)(2)(ii)(C), 29 CFR 2590.712– 

1(c)(2)(ii)(C), and 45 CFR 

146.137(c)(2)(ii)(C) to make clear that 

plans and issuers must describe any 

steps taken to correct, cure, or 

supplement any information, evidence, 

sources, or standards that are the basis 

for a factor or evidentiary standard and 

that would otherwise have been 

considered biased or not objective in the 

absence of such steps. Additionally, as 

discussed earlier in this preamble, these 

final rules also make minor 

modifications to better distinguish 

evidentiary standards from factors 

within the definitions of those terms, 

and clarify that, while this content 

element requires a plan or issuer to 

include a description of each 

evidentiary standard used to design or 

apply each factor, this information is 

part of the required detailed description 

of each factor. 

While the Departments acknowledge 

that identifying and defining all factors 

takes time for a plan or issuer to 

complete (for newly applied and 

existing NQTLs), the Departments note 

that this requirement was not new when 

it was included in the proposed rules. 

The CAA, 2021 specifically requires the 

identification and definition of factors 

relied upon to design and apply the 

NQTL,115 and has been applicable to 

plans and issuers since February 10, 

2021. Identification and definition of 

the factors considered in the design and 

application of an NQTL was also 

previously addressed in FAQs Part 

45.116 It is important for comparative 

analyses to include detailed information 

about factors, evidentiary standards, and 

their sources when a plan or issuer 

starts to perform and document its 

comparative analysis, to support the 

plan’s or issuer’s analysis of how factors 

and evidentiary standards are used to 

design and apply NQTLs. Such analysis 

should include support for the factors 

utilized from the time a plan or issuer 

decided to impose, or continues to 

impose, an NQTL on the relevant 

mental health and substance use 

disorder benefits, as well as medical/ 

surgical benefits. To the extent a plan or 

issuer cannot support its use of factors 

and evidentiary standards, including by 

providing information on the sources of 

the factors and evidentiary standards 

considered and relied on by plans and 

issuers (from the time they decided to 

impose the NQTL), it is unclear how 


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such plan or issuer can ensure that the 

factors and evidentiary standards are 

comparable and no more stringently 

designed and applied for mental health 

and substance use disorder benefits, 

than for medical/surgical benefits, as 

required under the statute (and the 

fourth and fifth content elements of a 

comparative analysis under these final 

rules). 

Without such information, a 

comparative analysis likely would not 

accurately describe factors and their 

sources and would not demonstrate 

that, when factors are used to design or 

apply an NQTL to mental health or 

substance use disorder benefits, they are 

comparable to, and not more stringently 

applied, than they are when used to 

design or apply an NQTL to medical/ 

surgical benefits. The absence of this 

information would also make it difficult 

for the Departments and applicable 

State authorities to confirm compliance 

with MHPAEA. The Departments stress 

that to the extent a plan or issuer 

applies factors that are processes, such 

as provider referral requirements, 

requirements to submit information for 

clinical review, or the development and 

approval of a treatment plan, such 

processes include both as written and in 

operation components. In addition, for 

these processes, a plan or issuer should 

be prepared to identify any sources 

utilized in determining the 

appropriateness of such requirements. 

To properly evaluate the comparability 

and stringency of such factors, it is 

important that any sources utilized be 

specifically identified in a comparative 

analysis. As stated earlier in this 

preamble, if a plan’s or issuer’s 

comparative analysis is requested by the 

Departments, the plan or issuer 

generally has multiple opportunities to 

engage with the Departments on these 

requirements. 

c. Description of How Factors Are Used 

in the Design and Application of the 

NQTL 

Under the third proposed content 

element, a plan or issuer would be 

required to provide a description of how 

each factor identified and defined in the 

second content element of the 

comparative analysis is used in the 

design or application of an NQTL to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits in a classification. This would 

include a detailed explanation of how 

each factor identified and defined in the 

comparative analysis is used to 

determine which mental health or 

substance use disorder benefits and 

which medical/surgical benefits are 

subject to the NQTL. The description 

would also include an explanation of 

the evidentiary standards or other 

information or sources (if any) 

considered or relied upon in designing 

or applying the factors or relied upon in 

designing and applying the NQTL, 

including in the determination of 

whether and how mental health or 

substance use disorder benefits or 

medical/surgical benefits are subject to 

the NQTL. 

In instances in which the application 

of the factor depends on specific 

decisions made in the administration of 

benefits, the comparative analysis 

would be required to provide 

information on the nature and timing of 

the decisions, and the professional 

designations and qualifications of each 

decision maker. The proposed rules 

further provided that, to the extent that 

more than one factor is identified and 

defined with respect to an NQTL, the 

comparative analysis would be required 

to explain how such factors relate to 

each other; the order in which all the 

factors are applied, including when they 

are applied; whether and how any 

factors are given more weight than 

others; and the reasons for the ordering 

or weighting of the factors. The analysis 

would also be required to address any 

deviation(s) or variation(s) from a factor, 

its applicability, or its definition 

(including the evidentiary standards 

used to define the factor and the 

information or sources from which each 

evidentiary standard was derived), such 

as how the factor is used differently to 

apply the NQTL to mental health and 

substance use disorder benefits as 

compared to medical/surgical benefits, 

and a description of how the plan or 

issuer establishes such deviations or 

variations. The Departments noted that 

the terms ‘‘deviations’’ or ‘‘variations’’ 

in this context referred to any 

differences in how a factor is applied 

with respect to an NQTL. 

The Departments received few 

comments on this content element. One 

commenter requested that the 

Departments clarify the requirement to 

document the qualifications of staff as 

well as for the professional designations 

and qualifications of each decision 

maker involved in the application of a 

given NQTL factor, requesting that the 

Departments describe how the 

requirement to document the 

professional designations and 

qualifications of each decision maker 

should be appropriately applied to 

health plan operations, and specifically 

Pharmacy and Therapeutics (P&T) 

committees. 

After reviewing comments, the 

Departments are finalizing, with minor 

non-substantive changes, the 

requirement that plans and issuers 

provide a description of how each factor 

identified and defined in the second 

content element of the comparative 

analysis is used in the design or 

application of an NQTL to mental health 

and substance use disorder benefits and 

medical/surgical benefits in a 

classification. This includes the 

requirement to include a detailed 

explanation of how each identified and 

defined factor is used to determine 

which benefits are subject to the NQTL, 

and an explanation of the evidentiary 

standards or other information or 

sources (if any) considered or relied 

upon in designing or applying the 

factors or relied upon in designing and 

applying the NQTL, including in the 

determination of whether and how 

benefits are subject to the NQTL. If the 

application of a factor depends on 

specific decisions made in the 

administration of benefits, the 

comparative analysis must also provide 

information on the nature and timing of 

the decisions, and the professional 

designations and qualifications of each 

decision maker. Additionally, if there is 

more than one factor, the comparative 

analysis must explain how all of the 

factors relate to each other; the order in 

which all the factors are applied, 

including when they are applied; 

whether and how any factors are given 

more weight than others; and the 

reasons for the ordering or weighting of 

the factors. Finally, the comparative 

analysis must address any deviations or 

variations from a factor, its 

applicability, or its definition (including 

the evidentiary standards used to define 

the factor and the information or 

sources from which each evidentiary 

standard was derived), such as how the 

factor is used differently to apply the 

NQTL to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, and a 

description of how the plan or issuer 

establishes such deviations or 

variations. As used in this context, the 

terms ‘‘deviations’’ or ‘‘variations’’ in 

these final rules refer to any differences 

in how a factor is applied with respect 

to an NQTL. 

In response to the request for how the 

requirement to document professional 

designations and qualifications applies 

to health plan operations, including 

P&T committees, the Departments 

emphasize that these committees must 

have members with similar expertise for 

mental health conditions and substance 

use disorders as for medical conditions 

and surgical procedures. This may not 

necessarily require the same number of 

members with expertise relevant to 


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mental health conditions and substance 

use disorders as it does for medical 

conditions and surgical procedures, but 

plans and issuers should ensure that 

members of a P&T committee include 

individuals with similar expertise with 

respect to these conditions and 

disorders. 

d. Demonstration of Comparability and 

Stringency, as Written 

Under the fourth proposed content 

element, plans and issuers would be 

required to evaluate whether, in any 

classification, under the terms of the 

plan (or health insurance coverage) as 

written, any processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

NQTL to mental health or substance use 

disorder benefits are comparable to, and 

are applied no more stringently than, 

the processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the NQTL with 

respect to medical/surgical benefits. The 

proposed rules would require plans and 

issuers to include in their comparative 

analyses, with respect to the NQTL and 

the factors used in designing and 

applying the NQTL, documentation of 

each factor identified and defined in the 

comparative analysis that was applied 

to determine whether the NQTL applies 

to mental health or substance use 

disorder benefits and medical/surgical 

benefits in a classification. This would 

include, as relevant, quantitative data, 

calculations, or other analyses showing 

whether, in each classification in which 

the NQTL applies, mental health or 

substance use disorder benefits and 

medical/surgical benefits met or did not 

meet any applicable threshold identified 

in the relevant evidentiary standard and 

the evaluation of relevant data to 

determine that the NQTL would or 

would not apply. In addition, such 

documentation would be required to 

include records maintained by the plan 

or issuer documenting the consideration 

and application of all factors and 

evidentiary standards, as well as the 

results of their application. Such 

records could include meeting minutes, 

or calculations related to quantitative 

factors, such as costs. 

Plans and issuers would also be 

required to include in their comparative 

analyses, in each classification in which 

the NQTL applies, a comparison of how 

the NQTL, as written, is applied to 

mental health or substance use disorder 

benefits and to medical/surgical 

benefits, including the specific 

provisions of any forms, checklists, 

procedure manuals, or other 

documentation used in designing and 

applying the NQTL or that address the 

application of the NQTL. Additionally, 

the plan or issuer would be required to 

include documentation in its 

comparative analysis demonstrating 

how the factors are comparably applied, 

as written, to mental health or substance 

use disorder benefits and medical/ 

surgical benefits in each classification, 

to determine which benefits are subject 

to the NQTL. If there is any deviation(s) 

or variation(s) in the application of a 

factor, the plan or issuer would be 

required to include in its comparative 

analysis an explanation of the reason(s) 

for such deviation(s) or variation(s) in 

the application of a factor used to apply 

the NQTL, or the application of the 

NQTL, to mental health or substance 

use disorder benefits as compared to 

medical/surgical benefits in the same 

classification, and how the plan or 

issuer establishes such deviation(s) or 

variation(s), including in the definition 

of the factors, the evidentiary standards 

used to define the factors, and the 

sources from which the evidentiary 

standards were derived; in the design of 

the factors or evidentiary standards; or 

in the application or design of the 

NQTL. In the preamble to the proposed 

rules, the Departments noted that the 

terms ‘‘deviations’’ or ‘‘variations’’ in 

this context refer to any differences in 

how a factor is applied with respect to 

an NQTL. 

Multiple commenters expressed 

support for the requirement to 

demonstrate comparability and 

stringency as written through the 

proposed requirements for the fourth 

content element. However, other 

commenters raised concerns about the 

proposal, with some requesting 

additional clarification or guidance to 

assist with achieving compliance. For 

example, one commenter requested that 

the Departments clarify the difference 

between the proposed requirement that 

plans and issuers provide 

documentation that demonstrates how 

factors are comparably applied in step 4 

of the comparative analysis content 

requirements, and the service-by-service 

documentation requirement for each 

factor under step 3 of the analysis, 

which requires a description of how 

factors are used in the design and 

application of the NQTL. 

Another commenter expressed 

concerns about how this content 

element may create operational 

challenges due to its breadth and how 

it would require plans to also consider 

other factors that were considered and 

not applied. Other commenters 

suggested ways that the Departments 

might ease the burden of the proposed 

fourth content element requirements on 

plans and issuers. One comment 

included a recommendation that the 

Departments clarify that plans and 

issuers can document each factor that 

was applied, including quantitative 

data, at the issuer level, rather than at 

the plan or coverage level. Another 

commenter encouraged the Departments 

to limit documentation requirements 

and enforcement to apply only to the 

comparability of the NQTL, as written 

and in operation; to acknowledge that 

subject matter experts may rely on 

professional knowledge, experience, 

and judgment to evaluate the 

evidentiary standard for identified 

factors; and to not require the use of 

quantitative data, calculations, or other 

analyses. Another commenter stated 

that the requirement to provide records 

documenting the consideration and 

application of all factors and evidentiary 

standards, as well as the results of their 

application, was inconsistent with the 

descriptions elsewhere of requiring a 

‘‘general description’’ of the factors 

relied upon, and therefore urged the 

Departments to eliminate the 

requirement to include the actual 

evidence and related records in the 

comparative analysis itself. 

The Departments note that, while the 

third content element requires a plan or 

issuer to provide details on how each 

factor (and evidentiary standards or 

other information or sources) is used in 

the design and application of an NQTL, 

that content element does not require an 

evaluation of whether the use of those 

factors complies with MHPAEA. 

Instead, these final rules require a 

demonstration of comparability and 

stringency, both as written and in 

operation, in the fourth and fifth content 

requirements for a comparative analysis, 

respectively. Additionally, the 

Departments are of the view that a plan 

or issuer cannot effectively demonstrate 

comparability and stringency, as written 

and in operation, without sufficiently 

identifying and defining each factor (in 

the second content element), and 

explaining how each factor is used to 

design and apply an NQTL (in the third 

content element). 

After reviewing comments, these final 

rules retain all of the proposed 

substantive features of the fourth 

content element requirements, which 

require that plans and issuers evaluate 

whether, in any classification, under the 

terms of the plan (or health insurance 

coverage) as written, any processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the NQTL to mental health or 

substance use disorder benefits are 

comparable to, and are applied no more 

stringently than, the processes, 

strategies, evidentiary standards, or 


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117As explained earlier in this preamble, these 

final rules amend the general rule in the design and 

application requirements, to align the language of 

the 2013 final regulations with the Departments’ 

interpretation that a plan or issuer must consider 

the comparability and relative stringency of any 

processes, strategies, evidentiary standards, or other 

factors, used in both designing and applying NQTLs 

to mental health or substance use disorder benefits 

as compared to medical/surgical benefits in a 

classification. These final rules revise the regulatory 

text to make this requirement with respect to 

designing the NQTL explicit and for consistency 

with the statutory language added by the CAA, 

2021. 

118Code section 9812(a)(8)(A)(iv), ERISA section 

712(a)(8)(A)(iv), and PHS Act section 

2726(a)(8)(A)(iv). 

other factors used in designing and 

applying the NQTL with respect to 

medical/surgical benefits. As finalized, 

this provision includes a technical 

modification to a citation that accounts 

for the reorganization of language in 26 

CFR 54.9812–1(c)(4)(iii), 29 CFR 

2590.712(c)(4)(iii), and 45 CFR 

146.136(c)(4)(iii) and also now specifies 

that the comparative analysis must 

include a comparison of how the NQTL, 

as written, is designed and applied to 

mental health or substance use disorder 

benefits and to medical/surgical 

benefits, instead of only as applied.117

The requirements related to 

demonstrating comparability and 

stringency as written under the fourth 

content element are otherwise being 

finalized as proposed. 

The Departments note that this 

content requirement does not require 

the use of quantitative data, 

calculations, or other analyses, nor does 

it prohibit plans from relying on 

professional knowledge, experience, 

and judgment to evaluate the 

evidentiary standard for the identified 

factors. Instead, this content element is 

meant to show how the factors 

described in the third content element 

used in designing and applying an 

NQTL to mental health and substance 

use disorder benefits are comparable to, 

and applied no more stringently than, 

the factors used in designing and 

applying the NQTL to medical/surgical 

benefits in the same classification, as 

written. Despite the potential 

operational challenges associated with 

the breadth of this content element, the 

Departments are of the view that it is a 

vital component of comparative 

analyses and is necessary to 

demonstrate compliance with MHPAEA 

as written, consistent with the 

statute.118 The Departments note that, as 

discussed earlier in this preamble, these 

final rules eliminate the duplicative 

requirement from the proposed rules 

that plans and issuers include a general 

description of any information 

considered or relied upon in preparing 

the comparative analysis for each 

NQTL. The final rules also eliminate a 

duplicative reference to the evaluation 

of relevant data in the fourth content 

element for comparative analyses, 

which is addressed as part of the fifth 

content element. 

The Departments recognize that a 

factor may be considered, but not used, 

to apply an NQTL to a specific benefit; 

however, to the extent such factor is 

used to design or apply the NQTL to 

mental health and substance use 

disorder benefits, it must be addressed 

in the plan’s or issuer’s comparative 

analysis, including in this fourth 

content element. The Departments are of 

the view that, to the extent an issuer or 

TPA uses factors or evidentiary 

standards to design and apply an NQTL 

consistently for multiple plans and 

coverage they administer, nothing in 

these final rules specifically prohibits 

the issuer or TPA from performing and 

documenting a comparative analysis at 

the level of the issuer (or TPA). 

However, to the extent relevant data 

exists at the level of the plan or coverage 

that measures access to mental health or 

substance use disorder benefits in a 

manner that is different than data at the 

level of the issuer or TPA, the 

Departments of are the view that a 

plan’s or issuer’s comparative analysis 

must account for that data, as described 

later in this preamble. 

The Departments note that it is 

possible that the reasons for any 

deviations or variations in the 

application of a factor used to apply the 

NQTL, or the application of the NQTL, 

might include steps to correct, cure, or 

supplement information, evidence, 

sources, or standards that would 

otherwise be considered biased or not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. To the extent 

a plan or issuer has adequately 

documented such steps as part of its 

comparative analysis, as required in the 

second content element of these final 

rules requiring the identification and 

definition of the factors used to design 

or apply the NQTL, the plan or issuer 

is not required to address such steps 

again in the fourth content element if 

otherwise applicable, and instead may 

include references to the description of 

such steps in the second content 

element, as appropriate. 

e. Demonstration of Comparability and 

Stringency, in Operation 

The Departments proposed that plans 

and issuers be required to evaluate in a 

comparative analysis whether, in any 

classification, under the terms of the 

plan (or health insurance coverage) in 

operation, the processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

NQTL to mental health or substance use 

disorder benefits are comparable to, and 

are applied no more stringently than, 

the processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the limitation 

with respect to medical/surgical 

benefits. A comprehensive explanation 

would be required to include an 

explanation of any methodology and 

underlying data used to demonstrate the 

application of the NQTL in operation, 

and the sample period, inputs used in 

any calculations, definitions of terms 

used, and any criteria used to select the 

mental health or substance use disorder 

benefits and medical/surgical benefits to 

which the NQTL is applicable. 

To comply with the proposed fifth 

content element, plans and issuers 

would also be required to identify the 

relevant data collected and evaluated in 

their comparative analyses and provide 

an evaluation of the outcomes that 

resulted from the application of the 

NQTL to mental health or substance use 

disorder benefits and medical/surgical 

benefits to demonstrate compliance 

with the design and application 

requirements. Additionally, the 

comparative analysis would be required 

to include a detailed explanation of 

material differences in outcomes that 

are not attributable to differences in the 

comparability or relative stringency of 

the NQTL as applied to mental health or 

substance use disorder benefits and 

medical/surgical benefits, as well as the 

basis for concluding that material 

differences in outcomes are not 

attributable to differences in the 

comparability or relative stringency of 

the NQTL. Finally, under this content 

element, the comparative analysis 

would be required to include a 

discussion of any measures that have 

been or are being implemented by the 

plan or issuer to mitigate any material 

differences in access with respect to 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

Many commenters expressed support 

for the proposed requirement and 

standards for the demonstration of 

comparability and stringency in 

operation captured in the proposed fifth 

content element, especially with respect 

to NQTLs related to network 

composition and the use and 

application of clinical guidelines. 

Commenters supported the proposed 

requirements for detailed comparative 

analyses because they reasoned that 

these requirements would help 


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regulators understand participant and 

beneficiary access to mental health and 

substance use disorder services under 

real conditions as opposed to only 

looking to written plan terms and 

policies. Some commenters also 

included recommendations for 

additional data transparency 

requirements to ensure compliance and 

ease the burden on the Departments in 

enforcing MHPAEA’s requirements. 

Several commenters also indicated a 

desire for additional clarification 

regarding this proposed content 

element. For example, one commenter 

noted that the fifth content element 

requires the demonstration of 

comparability and stringency in 

operation to be comprehensive, without 

discussion of what that term means. 

After reviewing comments, the 

Departments are finalizing the proposed 

requirements for the fifth content 

element with several clarifications and 

modifications. The Departments are 

finalizing the requirement that the 

comparative analysis must evaluate 

whether, in any classification, in 

operation, the processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

NQTL to mental health or substance use 

disorder benefits are comparable to, and 

are applied no more stringently than 

those used with respect to medical/ 

surgical benefits. However, the 

Departments have removed the 

references to the terms of the plan (or 

health insurance coverage) from this 

requirement, in recognition of the fact 

that the operations of the plan (or health 

insurance coverage) may not necessarily 

be reflected in its terms. 

The Departments are also finalizing 

the requirement that the comparative 

analysis must include a comprehensive 

explanation addressing the 

comparability and stringency of these 

processes, strategies, evidentiary 

standards, and other factors. These final 

rules require that this explanation 

address how the plan or issuer 

‘‘evaluates whether’’ (instead of 

‘‘ensures that’’), in operation, the 

processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the NQTL to 

mental health or substance use disorder 

benefits in a classification are 

comparable to, and are applied no more 

stringently than, those used in designing 

and applying the NQTL with respect to 

medical/surgical benefits. 

In these final rules, the Departments 

finalize with additional clarifications 

the proposal that, as part of the 

proposed fifth content element, a 

comprehensive explanation of how the 

plan or issuer evaluates in-operation 

compliance with the design and 

application requirements of MHPAEA 

would include an explanation of the 

methodology and underlying data used 

to demonstrate the application of the 

NQTL, as well as the sample period, 

inputs used in any calculations, 

definitions of terms used, and any 

criteria used to select the mental health 

or substance use disorder benefits and 

medical/surgical benefits to which the 

NQTL is applicable. These final rules 

also include language to align with 

changes made to address a lag between 

when an NQTL is newly designed and 

applied and when relevant data are 

available, as well as some limited 

circumstances in which no data exist 

that can reasonably assess any relevant 

impact of an NQTL on access to 

benefits. Specifically, with respect to an 

NQTL for which relevant data are 

temporarily unavailable, the 

Departments clarify that the 

comparative analysis must include a 

detailed explanation of the lack of 

relevant data, the basis for the plan’s or 

issuer’s conclusion that there is a lack 

of relevant data, and when and how the 

data will become available and be 

collected and analyzed. 

With respect to an NQTL for which no 

data exist that can reasonably assess any 

relevant impact of the NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits, 

the fifth content element requires the 

plan or issuer to include as part of the 

comparative analysis a reasoned 

justification as to the basis for the 

conclusion that there are no data that 

can reasonably measure the NQTL’s 

impact, an explanation of why the 

nature of the NQTL prevents the plan or 

issuer from reasonably measuring its 

impact, an explanation of what data was 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

that the NQTL complies with all 

applicable requirements. As noted 

earlier in this preamble, the 

Departments recognize that plans and 

issuers may encounter difficulties when 

attempting to collect and evaluate 

relevant data in certain circumstances, 

and, accordingly, intend to review the 

explanation provided in a plan’s or 

issuer’s comparative analysis to 

understand those difficulties in 

determining whether the plan or issuer 

is in compliance with these final rules. 

However, the Departments reiterate 

their intention that the provisions of 

these final rules regarding the 

unavailability of data shall only apply 

in very limited circumstances and, 

where applicable, shall be construed 

narrowly. 

The Departments are finalizing the 

proposed requirements for the fifth 

content element that a comparative 

analysis must include identification of 

the relevant data collected and 

evaluated, as well as documentation of 

the outcomes that resulted from the 

application of the NQTL to mental 

health or substance use disorder 

benefits and medical/surgical benefits, 

including the evaluation of relevant data 

as described earlier in this preamble. 

This also includes a reasoned 

justification and analysis that explains 

whether, and if so, why the plan or 

issuer concluded that differences in 

relevant data do or do not suggest the 

NQTL contributes to material 

differences in access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits. 

The Departments recognize that, for 

NQTLs related to network composition, 

under these final rules, a plan or issuer 

must collect and evaluate relevant data 

in a manner reasonably designed to 

assess the aggregate impact of all such 

NQTLs on access to mental health and 

substance use disorder benefits and 

medical/surgical benefits. Therefore, for 

NQTLs related to network composition, 

comparative analyses should analyze 

their impact as a whole. Plans and 

issuers may also, however, indicate in 

these comparative analyses where one 

particular NQTL may affect differences 

in access. 

Furthermore, in response to 

comments, these final rules provide 

more specifics on the requirement for 

the fifth content element to provide a 

detailed explanation of any material 

differences in access demonstrated by 

the outcomes evaluated, by requiring a 

reasoned explanation of any material 

differences in access that are not 

attributable to differences in the 

comparability or relative stringency of 

an NQTL as applied to mental health or 

substance use disorder benefits and 

medical/surgical benefits. This 

explanation should include a detailed 

discussion of any considerations beyond 

a plan’s or issuer’s control that 

contribute to the existence of material 

differences, as well as a detailed 

explanation of the bases for concluding 

that material differences are not 

attributable to differences in the 

comparability or relative stringency of 

the NQTL. The Departments note that 

such an explanation should be 

comprehensive and include evidence to 

support the conclusion that 

considerations beyond a plan’s or 

issuer’s control contribute to the 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77647 

119See 26 CFR 54.9812–1(c)(4)(iii)(C), 29 CFR 

2590.712(c)(4)(iii)(C), and 45 CFR 

146.136(c)(4)(iii)(C). 

existence of material differences in 

access. 

Additionally, these final rules add 

that, to the extent differences in access 

to mental health or substance use 

disorder benefits are attributable to 

independent professional medical or 

clinical standards or fraud and abuse 

measures, and such standards or 

measures are used as the basis for a 

factor or evidentiary standard used to 

design or apply an NQTL, comparative 

analyses must include documentation 

explaining how any such differences in 

access are attributable to those 

standards or measures. By requiring 

plans and issuers to analyze and explain 

material differences in access as 

demonstrated by outcomes, the 

Departments aim to encourage plans 

and issuers to examine closely and 

critically the extent to which access to 

benefits is shaped by particular NQTLs 

so that they can take effective, 

reasonable actions as necessary to 

mitigate material differences. 

Finally, these final rules specify that, 

in demonstrating comparability and 

stringency in operation under the fifth 

content element in these final rules, 

plans and issuers must discuss in their 

comparative analyses the actions that 

have been or are being taken by the plan 

or issuer, as necessary, to address any 

material differences in access. Under 

these final rules, this discussion must 

include, as applicable, a reasoned 

explanation of any material differences 

in access to mental health or substance 

use disorder benefits as compared to 

medical/surgical benefits that persist 

despite reasonable actions that have 

been or are being taken. Additionally, 

for a plan or issuer designing and 

applying one or more NQTLs related to 

network composition, to comply with 

this aspect of the fifth content element, 

the comparative analysis must include a 

discussion of the actions that have been 

or are being taken, as necessary, to 

address material differences in access to 

in-network mental health and substance 

use disorder benefits as compared to innetwork medical/surgical benefits, 

including those listed in these final 

rules as examples of possible actions 

that a plan or issuer could take to 

comply,119 if any such material 

differences exist. The Departments 

recognize that plans and issuers may 

already be aware of material differences 

in access to mental health or substance 

use disorder benefits and, as a result, 

may have taken actions to comply with 

MHPAEA’s requirements. The 

Departments are of the view that 

comparative analyses should address 

any such actions taken to address 

material differences in access and their 

effectiveness, to improve access to 

mental health and substance use 

disorder care for participants and 

beneficiaries and demonstrate 

compliance with MHPAEA. 

f. Findings and Conclusions 

Under the sixth and final proposed 

content element, a plan or issuer would 

be required to include in its 

comparative analysis its findings and 

conclusions as to the comparability of 

the processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the NQTL to 

mental health or substance use disorder 

benefits and medical/surgical benefits 

within each classification, and the 

relative stringency of their application, 

both as written and in operation. For 

this purpose, the comparative analysis 

would be required to include any 

findings or conclusions indicating that 

the plan or coverage is not (or might not 

be) in compliance with the provisions of 

the proposed rules for NQTLs, including 

any actions the plan or issuer has taken 

or intends to take to address any 

potential areas of concern or 

noncompliance. The comparative 

analysis would be required to include a 

reasoned and detailed discussion of 

those findings and conclusions, as well 

as citations to any additional specific 

information not otherwise included in 

the comparative analysis that supports 

the findings and conclusions. 

Additionally, the proposed rules 

would require that the comparative 

analysis include the date of the analysis 

and the title and credentials of all 

relevant persons who participated in the 

performance and documentation of the 

comparative analysis. If the comparative 

analysis relies upon an evaluation by a 

reviewer or consultant considered by 

the plan or issuer to be an expert, the 

comparative analysis would be required 

to include an assessment of each 

expert’s qualifications and the extent to 

which the plan or issuer ultimately 

relied upon each expert’s evaluation in 

performing and documenting the 

comparative analysis of the design and 

application of each NQTL applicable to 

both mental health or substance use 

disorder benefits and medical/surgical 

benefits. For plans subject to ERISA, the 

comparative analysis would be required 

to include a certification by one or more 

named fiduciaries who have reviewed 

the analysis, stating whether they found 

the comparative analysis to be in 

compliance with the content 

requirements of the proposed rules. 

With respect to the requirements 

regarding reliance on an evaluation by 

an expert, one commenter was 

supportive of the rule as proposed, and 

another recommended that the 

Departments not require that the 

comparative analyses include the name 

of the expert so that experts would not 

be dissuaded from providing their 

expertise to avoid public identification. 

Some commenters were supportive of 

the fiduciary certification requirement 

for plans subject to ERISA, with one 

stating that this would help to ensure 

that plan fiduciaries meet their 

obligations to review comparative 

analyses and monitor their plans for 

compliance. Many other commenters 

expressed concern, with some reasoning 

that requiring a named fiduciary to 

review and certify that a comparative 

analysis complies with the content 

requirements of the proposed rules 

would put an unrealistic expectation on 

that fiduciary to understand the 

required nuance and complexity of the 

proposed rules. Other commenters 

opined that the requirement would 

create an unnecessary burden. These 

commenters stressed that the 

requirement would increase compliance 

costs (as fiduciaries would have to 

contract with additional service 

providers to assess compliance) without 

increasing access to benefits. Other 

commenters highlighted that Congress 

knew how to provide for a certification 

or attestation requirement but refrained 

from doing so for the MHPAEA 

comparative analysis. These comments 

urged against including the fiduciary 

certification requirement. 

The Departments are of the view that 

requiring plans and issuers to address 

the findings and conclusions of both 

comparability and stringency of 

processes, strategies, evidentiary 

standards and other factors in their 

comparative analysis is necessary and 

appropriate to increase and ensure 

compliance with MHPAEA. The 

Departments’ experience enforcing the 

current regulatory framework has shown 

that, too often, plans and issuers design 

and apply NQTLs without considering 

the impact those NQTLs have on access 

to mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits for 

participants and beneficiaries. In 

practice, the Departments have 

encountered many NQTLs that often 

impose a greater burden on access to 

mental health and substance use 

disorder benefits than medical/surgical 

benefits. Therefore, the Departments are 

finalizing, with modifications, the 

requirements for the sixth content 

element that requires plans and issuers 


khammond on DSKJM1Z7X2PROD with RULES2
77648 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

120See 88 FR 51552, 51651 (Aug. 3, 2023), setting 

forth the proposed requirement that one or more 

named fiduciaries who have reviewed a 

comparative analysis provide a certification stating 

whether they found the comparative analysis to be 

in compliance with the content requirements of the 

regulations. 121Code section 9812(a)(8), ERISA section 

712(a)(8), and PHS Act section 2726(a)(8). This 

requirement was reiterated in FAQs Part 45, https:// 

www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/ 

our-activities/resource-center/faqs/aca-part-45.pdf 

and https://www.cms.gov/CCIIO/Resources/FactSheets-and-FAQs/Downloads/MHPAEA-FAQs-Part45.pdf. 

to address the findings and conclusions 

as to the comparability and relative 

stringency of the processes, strategies, 

evidentiary standards, and other factors 

used in designing and applying NQTLs 

in their comparative analyses. The 

requirement under these final rules that 

plans and issuers must include any 

findings and conclusions is consistent 

with the statutory text, and these final 

rules also specify that these findings 

and conclusions must be included 

whether or not the plan or coverage is 

or is not (or might or might not be) in 

compliance. The Departments stress 

that, while these final rules require an 

assessment of each expert’s 

qualifications and the extent to which 

the plan or issuer ultimately relied on 

their evaluation (if at all), these final 

rules do not require the name of the 

expert in the comparative analysis. 

These final rules also make additional 

minor technical edits to the sixth 

content requirement, for clarity. 

In response to comments expressing 

concern with the named fiduciary 

certification requirement for plans 

subject to ERISA in the proposed rules, 

DOL is modifying this requirement. 

These final rules continue to require, for 

plans subject to ERISA, the comparative 

analysis to include a certification by one 

or more named fiduciaries. However, 

instead of requiring noted fiduciaries to 

state whether they found the 

comparative analysis to be in 

compliance with the content 

requirements, these final rules require 

certification confirming the fiduciary’s 

engagement in a prudent process to 

select one or more qualified service 

providers to perform and document a 

comparative analysis in connection with 

the imposition of any NQTLs that apply 

to mental health and substance use 

disorder benefits under the plan in 

accordance with MHPAEA and its 

implementing regulations, as well as 

satisfaction of the duty to monitor those 

service providers. For this purpose, DOL 

expects that a plan fiduciary making 

such a certification will, at a minimum, 

review the comparative analysis 

prepared by or on behalf of the plan 

with respect to an NQTL applicable to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits; ask questions about the 

analysis and discuss it with service 

providers, as necessary, to understand 

the findings and conclusions 

documented in the analysis; and ensure 

that a service provider responsible (in 

whole or in part) for performing and 

documenting a comparative analysis 

provides assurance that, to the best of its 

ability, the NQTL and associated 

comparative analysis complies with the 

requirements of MHPAEA and its 

implementing regulations. While not 

required, a plan fiduciary may 

alternatively provide a certification that 

each comparative analysis is in 

compliance with the content 

requirements, consistent with the 

proposed certification requirement in 

the proposed rules.120 Because the 

statute expressly places the obligation 

on the plan (or issuer) to ensure 

compliance with MHPAEA, these final 

rules align with the duties ERISA 

imposes on plan fiduciaries under part 

4 of ERISA. 

2. Requirement To Provide Comparative 

Analyses and Notices to the Department 

and Other Individuals and Entities—26 

CFR 54.9812–2(d) and (e), 29 CFR 

2590.712–1(d) and (e), and 45 CFR 

146.137(d) and (e) 

Effective February 10, 2021, plans and 

issuers have been required, consistent 

with the statute, to perform and 

document comparative analyses and 

make them available to the Departments 

or applicable State authorities upon 

request.121 The proposed rules would 

require that plans and issuers make a 

comparative analysis available and 

submit it upon request to the relevant 

Secretary (as well as applicable State 

authorities and participants and 

beneficiaries in certain circumstances), 

explain that additional information may 

be required to be provided after a 

comparative analysis is deemed 

insufficient, and outline requirements 

for plans and issuers after an initial 

determination of noncompliance and a 

final determination of noncompliance. 

Some commenters were supportive of 

the proposed requirements, though 

others offered suggestions for improving 

the various elements, as described later 

in this preamble. 

Once a comparative analysis is 

requested, plans and issuers would be 

required to provide a comparative 

analysis within 10 business days of 

receipt of a request from the relevant 

Secretary (or an additional period of 

time specified by the relevant 

Secretary). Some commenters remarked 

that 10 business days is not sufficient to 

provide a comparative analysis upon 

request. While a few commenters 

requested that the Departments allow 

plans and issuers at least 30 days to 

provide the requested information, 

others requested a 60-day period to 

provide an updated comparative 

analysis. Several commenters 

highlighted that plans and issuers might 

not anticipate what is regarded as an 

NQTL by the Departments and 

requested that the Departments provide 

additional time to respond to a request 

for a comparative analysis for an NQTL 

that was not on an illustrative list of 

NQTLs provided by the Departments. 

After reviewing comments, the 

Departments are finalizing, as proposed, 

the requirement that plans and issuers 

make available a comparative analysis 

and submit it to the relevant Secretary 

within 10 business days of receipt of a 

request from the relevant Secretary (or 

an additional period of time specified 

by the relevant Secretary). Plans and 

issuers are statutorily obligated to 

perform and document their NQTL 

comparative analyses, and to be ready to 

make them available in response to a 

request, regardless of whether the plan 

or issuer has actually received a request 

from the Departments or an applicable 

State authority, and have been since 

February 10, 2021. While these final 

rules specify content elements that 

comparative analyses must contain, the 

Departments have expected, and will 

continue to expect, that plans and 

issuers perform and document their 

NQTL comparative analyses without 

waiting for a request from the 

Departments or an applicable State 

authority. Where plans and issuers have 

performed and documented their NQTL 

comparative analyses, additional time 

will not generally be required to 

respond to an initial request. The 

language allowing an additional period 

of time specified by the Secretary for a 

plan or issuer to submit a comparative 

analysis to the Secretary provides 

sufficient flexibility to plans and issuers 

where the Departments determine it to 

be appropriate. 

Under the proposed rules, in 

instances in which the Secretary 

determines that the plan or issuer has 

not submitted sufficient information for 

the Secretary to review the requested 

comparative analysis, the Secretary will 

specify to the plan or issuer the 

additional information the plan or 

issuer must submit to the Secretary to be 

responsive to the request. The plan or 

issuer would be required to furnish this 

additional information to the relevant 

Secretary within 10 business days after 

the relevant Secretary specifies the 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77649 

122See, e.g., 2023 MHPAEA Comparative 

Analysis Report to Congress (July 2023), https://

www.dol.gov/sites/dolgov/files/ebsa/laws-andregulations/laws/mental-health-parity/report-tocongress-2023-mhpaea-comparative-analysis.pdf. 

Other reports are available at https://www.dol.gov/ 

agencies/ebsa/about-ebsa/our-activities/resourcecenter/reports. 

additional information to be submitted 

(or an additional period of time 

specified by the relevant Secretary). The 

Departments noted in the preamble to 

the proposed rules that a request for 

additional information by the relevant 

Department or an applicable State 

authority may include a request for data 

to analyze the assertions made in the 

comparative analyses, consistent with 

existing authority. This additional 

information or data may relate to the 

data required by the Departments to be 

collected and evaluated under the 

relevant data evaluation requirements. 

A few commenters stated that 10 

business days was not enough time to 

respond with supplemental information, 

calling the timeframe overly restrictive 

and unrealistically short. One requested 

60 days to respond to such a request 

instead of 10 business days as proposed. 

After reviewing comments, the 

Departments are finalizing with minor 

technical edits the requirement that 

plans and issuers furnish the additional 

requested information to the relevant 

Secretary within 10 business days after 

the relevant Secretary specifies the 

additional information to be submitted 

(or an additional period of time 

specified by the relevant Secretary). The 

Departments acknowledge that in some, 

but not all, cases, 10 business days may 

not be enough time to respond with 

supplemental information and recognize 

that not all requests for supplemental 

information are equal in terms of the 

volume and complexity of the 

information requested, which is why 

these final rules allow for additional 

time to be specified by the relevant 

Secretary (for example, where the 

volume or complexity of the additional 

information requested would take more 

time to collect and provide). The 

Departments emphasize that additional 

information must be provided within 10 

business days, rather than calendar 

days, and are of the view that, in the 

majority of cases, 10 business days 

should be sufficient. However, unless 

otherwise specified, the other timelines 

associated with the comparative 

analysis requirements generally refer to 

calendar days. 

In instances where the relevant 

Secretary has reviewed a plan’s or 

issuer’s comparative analyses (and any 

additional information submitted upon 

request), and made an initial 

determination that the plan or issuer is 

not in compliance with the 

requirements related to NQTLs, the 

Departments proposed to require the 

plan or issuer to respond to the relevant 

Secretary, specifying the actions it will 

take to come into compliance. The plan 

or issuer would also be required to 

provide to the relevant Secretary 

additional comparative analyses 

meeting the requirements of the 

proposed rules that demonstrate 

compliance with MHPAEA. The plan or 

issuer would be required to submit 

these responses to the relevant Secretary 

not later than 45 calendar days after the 

relevant Secretary’s initial 

determination that the plan or issuer is 

not in compliance. 

One commenter stated that the 

proposed penalties for noncompliance 

are not strict enough to discourage 

noncompliant issuer behavior and 

stated that, without strict enforcement 

penalties, issuers will continue to 

attempt to skirt the law. Additionally, as 

discussed earlier in the preamble, other 

commenters urged the Departments to 

provide procedural guardrails and due 

process protections for plans and issuers 

prior to the final determination of 

noncompliance, suggesting that the plan 

or issuer should have an opportunity to 

meet with the DOL or HHS national 

office, review the determination, and 

work together to achieve compliance. 

After reviewing comments, the 

Departments are finalizing this 

requirement with minor edits. These 

final rules clarify, however, that the 

plan or issuer must respond to the 

initial determination by the Secretary, 

instead of more generally requiring the 

plan or issuer to respond to the 

Secretary, as proposed, to better match 

the statutory text. In response to the 

commenter who criticized the penalties 

for noncompliance, the Departments 

note that they do not have the statutory 

authority to increase penalties for 

violations of MHPAEA, but, as 

discussed earlier in this preamble, have 

stepped up enforcement efforts and 

anticipate continuing to prioritize 

enforcement of these requirements. 

As discussed earlier in the preamble, 

the statute establishes the comparative 

analysis request process, as well as the 

penalties for failing to comply, and, 

working within this process, the 

Departments have worked with many 

plans and issuers to achieve 

compliance, often without issuing a 

final determination of noncompliance, 

as described at length in our MHPAEA 

Reports to Congress.122 The 

Departments expect that this approach 

will continue to work after the issuance 

of these final rules. To the extent 

possible, the Departments expect to 

continue to work with plans and issuers 

to ensure compliance, without need of 

issuance of a final determination of 

noncompliance. 

If the relevant Department makes a 

final determination that the plan or 

issuer is not in compliance with 

MHPAEA (after issuance of an initial 

determination of noncompliance, a 

failure by the plan or issuer to 

sufficiently respond to the initial 

determination and specify the actions 

the plan or issuer will take to bring the 

plan or coverage into compliance, and a 

failure to provide additional sufficient 

comparative analyses within the 45- 

calendar-day corrective action period), 

the plan or issuer must, within 7 

calendar days of the receipt of the final 

determination of noncompliance, 

provide a standalone notice that is not 

combined with any other notices or 

disclosures, as required under 

applicable Federal or State law, to all 

participants and beneficiaries enrolled 

in the plan or coverage that the plan or 

issuer has been determined to not be in 

compliance with the requirements of the 

proposed rules. The plan or issuer 

would also be required to provide a 

copy of the notice to the relevant 

Secretary, any service provider involved 

in the claims process, and any fiduciary 

responsible for deciding benefit claims 

within the same timeframe. The 

Departments noted in the preamble to 

the proposed rules that this notice gives 

participants and beneficiaries (or their 

authorized representatives) critically 

important information for the pursuit 

and protection of their own benefit 

claims and rights and provides a 

powerful incentive for the plan or issuer 

to take necessary corrective actions to 

come into compliance following an 

initial determination of noncompliance. 

The proposed rules set forth 

requirements for the content of this 

notice and the manner in which it 

would be required to be provided, 

including that the notice be written in 

plain language and in a manner 

calculated to be understood by the 

average plan participant. The notice 

would also be required to include the 

following statement prominently 

displayed on the first page, in no less 

than 14-point font: 

Attention! The [Department of Labor/ 

Department of Health and Human Services/ 

Department of the Treasury] has determined 

that [insert the name of group health plan or 

health insurance issuer] is not in compliance 

with the Mental Health Parity and Addiction 

Equity Act. 

The proposed rules would also 

require the notice contain a summary of 


khammond on DSKJM1Z7X2PROD with RULES2
77650 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

123See 26 CFR 54.9815–2715(a)(4)(ii)(B), 29 CFR 

2590.715–2715(a)(4)(ii)(B), and 45 CFR 

147.200(a)(4)(ii)(B). 

any changes the plan or issuer has made 

as part of its corrective action plan 

specified to the Secretary following the 

initial determination of noncompliance, 

including an explanation of any 

opportunity for a participant or 

beneficiary to have a claim for benefits 

reprocessed. Additionally, the notice 

would be required to include a 

summary of the Secretary’s final 

determination that the plan or issuer is 

not in compliance, including any 

provisions or practices identified to be 

in violation of MHPAEA, any additional 

corrective actions identified by the 

Secretary in the final determination 

notice, and information on how 

participants and beneficiaries can obtain 

a copy of the final determination of 

noncompliance from the plan or issuer. 

This notice would also be required to 

include any other actions the plan or 

issuer is taking to come into compliance 

with MHPAEA, information on when 

the plan or issuer will take (or has 

taken) such actions, and a clear and 

accurate statement explaining whether 

the Secretary has concurred with those 

actions. Finally, the proposed rules 

would require that the notice include 

contact information for questions and 

complaints, with a statement explaining 

how participants and beneficiaries can 

obtain more information about the 

notice, including a phone number and 

an email or web portal address for the 

plan or issuer, and contact information 

for the relevant Department. 

Under the proposed rules, a plan or 

issuer would be required to make the 

notice available in paper form. The plan 

or issuer may alternatively make the 

notice available electronically (such as 

by email or an internet posting) if the 

format is readily accessible, the notice is 

provided in paper form free of charge 

upon request, and, in a case in which 

the electronic form is an internet 

posting, the plan or issuer timely 

notifies participants and beneficiaries in 

paper form (such as a postcard) or email 

that the documents are available on the 

internet, provides the internet address, 

and notifies participants and 

beneficiaries that the documents are 

available in paper form upon request. 

The Departments noted that this 

approach is similar to standards for 

when a plan or issuer is permitted to 

provide a copy of its plan’s or coverage’s 

summary of benefits and coverage with 

respect to participants and beneficiaries 

who are eligible but not enrolled for 

coverage.123 For ERISA plans, the plan 

or issuer would also be required to 

ensure that the notice is provided to any 

service provider involved in the claims 

process and any fiduciary responsible 

for deciding benefit claims within 7 

calendar days of receipt of the final 

determination of noncompliance, so that 

the service provider or fiduciary can 

appropriately take the violation into 

account in deciding claims in 

compliance with the requirements of 29 

CFR 2590.712(c)(4) and in accordance 

with section 404(a)(1)(D) of ERISA. 

Multiple commenters recommended 

that the requirement for plans and 

issuers to include information in the 

notice about any opportunity for a 

participant or beneficiary to have claims 

reprocessed be revised to instead place 

affirmative obligations on plans and 

issuers who receive a final 

determination of noncompliance to 

identify affected participants or 

beneficiaries, reprocess claims, and take 

other necessary steps to rectify harms. 

One commenter further suggested that 

plans or issuers be required to describe 

the process they will follow and the 

time frames for reprocessing claims in 

the notice of noncompliance. Another 

commenter opposed the requirement 

that a plan deemed noncompliant send 

a notice to all beneficiaries, arguing that 

it amounted to public shaming and that 

it was beyond the scope of the 

authorizing statute. 

Several commenters suggested that 

the notice should be provided to 

participating providers, as such 

providers may have experienced issues 

submitting claims to plans and issuers 

for reimbursement, including improper 

denials, and stopped submitting further 

claims. One commenter requested that 

these final rules be accompanied by 

guidance and online compliance 

resources developed by the Departments 

to help the affected plans and issuers 

draft their notices of noncompliance. 

Several commenters expressed 

concern that providing notice within 7 

calendar days would not be feasible, 

particularly with the level of 

information that a plan or issuer is 

required to compile and provide. Some 

commenters requested a 30-day period 

to provide this notice and others 

requested a 45-day period. 

After reviewing comments, the 

Departments are finalizing with minor 

clarifications the provision that a plan 

or issuer must notify all participants 

and beneficiaries enrolled in the plan or 

coverage that the plan or issuer has been 

determined to not be in compliance 

with the requirements of MHPAEA if 

the Secretary makes a final 

determination of noncompliance, as 

required by the statute. The 

Departments highlight that the statute 

specifies the notice be provided within 

7 days, and the Departments lack the 

statutory authority to extend this 

timeframe, such as to 30 or 45 days, as 

suggested by commenters. However, in 

response to comments, these final rules 

provide that plans and issuers have 7 

business days instead of 7 calendar days 

to notify participants and beneficiaries 

of a final determination of 

noncompliance, to provide plans and 

issuers additional time to prepare the 

notice of final determination as required 

under these final rules. 

The Departments also note that the 

relevant statutory language requires 

notice to be sent to ‘‘all individuals 

enrolled in the plan or applicable health 

insurance coverage offered by the 

issuer,’’ which includes participants 

and beneficiaries, rather than attending 

providers. However, if a single notice is 

provided to a participant and any 

beneficiaries at the participant’s last 

known address, the requirement to 

provide notice to participants and 

beneficiaries is considered satisfied, 

unless the plan or issuer knows (or 

reasonably should have known) that the 

beneficiary’s last known address is 

different, in which case a notice is 

required to be provided to the 

beneficiary at the beneficiary’s last 

known address. 

The Departments are also finalizing 

the requirement for ERISA-covered 

plans that the plan or issuer must 

provide a copy of the notice to any 

service provider involved in the claims 

process, and any fiduciary responsible 

for deciding benefit claims within 7 

business days of receipt of the final 

determination of noncompliance. DOL 

recognizes that, depending on the 

nature of the NQTL and the final 

determination of noncompliance, not all 

such determinations will impact 

adjudicated claims, but is of the view 

that it is important for such information 

to be disclosed to relevant service 

providers and fiduciaries, so they can 

properly consider whether such changes 

are required. 

The Departments are finalizing the 

proposed notice content requirements 

and stress that the notice must describe 

any other actions the plan or issuer is 

taking to come into compliance with 

MHPAEA. Generally, when 

noncompliance has been identified, the 

Departments will require plans and 

issuers to take steps to identify affected 

participants, reprocess claims, and take 

other necessary steps to rectify harms; 

however, the specific steps a plan or 

issuer will be required to take in 

response to a final determination of 

noncompliance will depend on the facts 

and circumstances of the violations. 


khammond on DSKJM1Z7X2PROD with RULES2
Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77651 

124See, e.g., 26 CFR 54.9812–1(d)(3), 29 CFR 

2590.712(d)(3), and 45 CFR 146.136(d)(3); FAQs 

About Affordable Care Act Implementation Part V 

and Mental Health Parity Implementation (Dec. 22, 

2010), https://www.dol.gov/sites/dolgov/files/EBSA/ 

about-ebsa/our-activities/resource-center/faqs/acapart-v.pdf and https://www.hhs.gov/guidance/ 

document/affordable-care-act-implementation-faqsset-5; FAQs About Affordable Care Act 

Implementation Part 31, Mental Health Parity 

Implementation and Women’s Health and Cancer 

Rights Action Implementation (Apr. 20, 2016), 

https://www.dol.gov/sites/dolgov/files/EBSA/aboutebsa/our-activities/resource-center/faqs/aca-part31.pdf and https://www.hhs.gov/guidance/ 

document/affordable-care-act-implementation-faqsset-31; FAQs About Mental Health Parity 

Implementation and the Consolidated 

Appropriations Act, 2021 Part 45 (Apr. 2, 2021), 

https://www.dol.gov/sites/dolgov/files/ebsa/aboutebsa/our-activities/resource-center/faqs/aca-part45.pdf and https://www.cms.gov/CCIIO/Resources/ 

Fact-Sheets-and-FAQs/Downloads/MHPAEA-FAQsPart-45.pdf. 

While these final rules generally require 

a plan or issuer to include an 

explanation of any opportunity for a 

participant or beneficiary to have a 

claim for benefits reprocessed (or, as 

explained below, submitted) in a notice 

describing a final determination of 

noncompliance, the Departments do not 

intend that provision to imply that 

plans and issuers will not be obligated 

to take any other particular actions 

intended to provide appropriate 

corrections to affected individuals or 

otherwise remediate potential harms. 

As noted throughout this preamble to 

these final rules, the Departments are 

committed to ensuring that participants 

and beneficiaries have access to the 

mental health and substance use 

disorder benefits covered under their 

plan or coverage and are not adversely 

affected by violations of MHPAEA. The 

Departments are, however, modifying 

the requirement that plans and issuers 

must include a clear and accurate 

statement as to whether the Secretary 

has indicated that those actions, if 

completed, will result in compliance, to 

reflect that the Secretary may not be 

able to know whether the actions taken 

or being taken will bring the plan into 

compliance. Instead, under these final 

rules, plans and issuers must indicate 

whether the relevant Secretary has 

concurred with those actions. The 

Departments are also modifying the 

requirement that the notice include a 

description of any opportunity for a 

participant or beneficiary to have a 

claim for benefits reprocessed to include 

any opportunity to submit a new claim, 

to account for participants and 

beneficiaries who did not initially file a 

claim for a mental health or substance 

use disorder benefit that could have 

been covered. 

In the proposed rules, the 

Departments solicited comment on 

other measures to increase transparency 

and better inform the general public 

regarding final agency determinations of 

noncompliance of plans or issuers with 

MHPAEA. One commenter suggested 

that to improve transparency, all 

informational materials published to the 

public following final agency 

determinations of noncompliance 

should clearly state the name of the 

insurer who holds contracts with the 

TPA or MBHO if a TPA or MBHO is 

found to be in violation of MHPAEA. 

The commenter also recommended that 

the Departments require all States to 

make notices of MHPAEA violations 

publicly available via State agency 

websites and other avenues easily 

accessible by beneficiaries within a 

reasonable timeframe after 

determinations of noncompliance with 

MHPAEA are made. The Departments 

acknowledge these comments and will 

continue to consider them. 

In addition to making the comparative 

analyses available upon request to the 

relevant Secretary, the Departments 

proposed to codify a requirement that 

plans and issuers make available the 

comparative analyses when requested 

by any applicable State authority, as 

well as participants and beneficiaries 

(including a provider or other person 

acting as a participant’s or beneficiary’s 

authorized representative) who has 

received an adverse benefit 

determination related to mental health 

or substance use disorder benefits and, 

for ERISA-covered plans, participants 

and beneficiaries at any time, under 

authority under ERISA section 104. The 

Departments noted that, while the 

proposed rules would codify the 

statutory requirement to make 

comparative analyses available to the 

applicable State authority upon request, 

the proposed rules would not otherwise 

apply the timeframes and processes 

regarding the Secretarial request process 

to requests for comparative analyses 

made by applicable State authorities. 

The Departments requested comments 

on these proposals, including whether 

the proposed requirements should apply 

to plans and issuers with respect to a 

request made by the applicable State 

authority for an NQTL comparative 

analysis, including the proposed notice 

requirement following a final 

determination of noncompliance. 

Some commenters recommended that 

the Departments emphasize that health 

insurance issuers have an unambiguous 

duty to share their MHPAEA 

comparative analyses with applicable 

State authorities upon request even if 

the relevant Secretary has not also made 

the same request. Commenters also 

recommended that the Departments 

work closely with State insurance 

authorities to incentivize and facilitate 

the implementation of comparable 

review and notice standards. Several 

other commenters requested the 

Departments include applicable State 

authorities in proposed 26 CFR 

54.9812–2(b), 29 CFR 2590.712–1(b), 

and 45 CFR 146.137(b), to make clear 

that States have the authority to request 

comparative analyses. Some 

commenters noted that some issuers 

refuse to provide comparative analyses 

to the applicable State authority upon 

request. Commenters requested 

guidance concerning requests from 

participants, beneficiaries, and 

authorized representatives who have 

received an adverse benefit 

determination related to mental health 

and substance use disorder benefits, 

including one commenter requesting 

guidance on how participants, 

beneficiaries, and their authorized 

representatives may report potential 

violations of MHPAEA, and another 

commenter that requested clear 

guidelines regarding when the issuance 

of an adverse benefit determination 

triggers a requirement by the plan to 

disclose its comparative analyses, upon 

request. 

After reviewing comments, the 

Departments are finalizing as proposed 

the requirement that plans and issuers 

must make available a copy of the 

comparative analysis when requested by 

any applicable State authority, a 

participant or beneficiary (or a provider 

or other person acting as a participant’s 

or beneficiary’s authorized 

representative) who has received an 

adverse benefit determination related to 

mental health or substance use disorder 

benefits, and, for ERISA-covered plans, 

participants and beneficiaries generally, 

who may request the comparative 

analysis at any time under ERISA 

section 104. The Departments are of the 

view that it is important that 

participants and beneficiaries are able to 

access comparative analyses of NQTLs 

imposed on mental health and 

substance use disorder benefits under 

their plan or coverage. In implementing 

MHPAEA, the Departments have heard 

repeated complaints that plans and 

issuers fail to disclose information on 

the processes, strategies, evidentiary 

standards, and other factors used to 

design and apply an NQTL, including 

the relevant comparative analyses to 

participants and beneficiaries, despite 

clear statements by the Departments 

regarding this requirement.124 The 

Departments are concerned that limiting 

the ability of participants and 

beneficiaries (or their authorized 

representatives) to request the 


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125Coverage offered by Medicaid managed care 

organizations, CHIP, and Medicaid Alternative 

Benefit Programs are subject to separate mental 

health parity regulations at codified at 42 CFR parts 

438, 440, 456, and 457. See Medicaid and 

Children’s Health Insurance Programs; Mental 

Health Parity and Addiction Equity Act of 2008; 

Application of Mental Health Parity Requirements 

to Coverage Offered by Medicaid Managed Care 

Organizations, the Children’s Health Insurance 

Program (CHIP), and Alternative Benefit Plans; 

Final Rule. 81 FR 18390 (Mar. 30, 2016), https://

www.federalregister.gov/documents/2016/03/30/ 

2016-06876/medicaid-and-childrens-healthinsurance-programs-mental-health-parity-andaddiction-equity-act-of. 

126 26 CFR 54.9812–1, revised as of April 1, 2023, 

29 CFR 2590.712, revised as of July 1, 2022, and 45 

CFR 146.136, revised as of October 1, 2021. 

comparative analyses to only those 

situations where there is an adverse 

benefit determination related to mental 

health or substance use disorder 

benefits, would frustrate participants’ 

and beneficiaries’ ability to get the 

information they need about their 

mental health and substance use 

disorder benefits to effectuate their 

rights, including in situations where 

they forgo submitting a claim for 

benefits. The Departments remain 

committed to responding to inquiries 

and complaints about compliance with 

MHPAEA, and participants, 

beneficiaries, and enrollees, as well as 

their authorized representatives, may 

contact EBSA at 1–866–444–3272 or 

https://www.dol.gov/agencies/ebsa/ 

about-ebsa/ask-a-question/ask-ebsa or 

HHS at 1–800–985–3059 or https://

www.cms.gov/medical-bill-rights/help/ 

submit-a-complaint. 

As specified earlier in the preamble, 

the statute requires that plans and 

issuers must provide a copy of the 

comparative analysis to any applicable 

State authority upon request. The 

statute does not require applicable State 

authorities to follow the same procedure 

to review and request comparative 

analyses as that applicable to the 

Departments, and, therefore, these final 

rules do not include ‘‘applicable State 

authorities’’ in the regulatory text that 

describes this procedure. However, 

these final rules at 26 CFR 54.9812–2(e), 

29 CFR 2590.712–1(e), and 45 CFR 

146.137(e) provide that a health 

insurance issuer in a State must provide 

the comparative analysis to the 

applicable State authority (that is, the 

State insurance commissioner or official 

or officials designated by the State to 

enforce the requirements of title XXVII 

of the PHS Act for the State involved 

with respect to such issuer) upon 

request. Additionally, compliance with 

MHPAEA is not determinative of 

compliance with other State or Federal 

laws. Applicable State authorities retain 

independent authority over issuers of 

group and individual health insurance 

coverage and may request or require 

additional information under their own 

authorities. Issuers of group and 

individual health insurance coverage 

must also comply with State insurance 

laws, to the extent they do not prevent 

the application of the requirements of 

MHPAEA. 

C. Applicability—26 CFR 54.9812–1(i), 

29 CFR 2590.712(i), and 45 CFR 

146.136(i) and 26 CFR 54.9812–2(g), 29 

CFR 2590.712–1(g), and 45 CFR 

146.137(g) 

The Departments proposed to amend 

26 CFR 54.9812–1(i)(1), 29 CFR 

2590.712(i)(1), and 45 CFR 146.136(i)(1) 

to specify that, except as provided in 

paragraph (i)(2), the proposed rules 

applicable to group health plans (and 

health insurance coverage offered by an 

issuer in connection with such 

plans) 125 would apply on the first day 

of the first plan year beginning on or 

after January 1, 2025. The Departments 

acknowledged in the preamble of the 

proposed rules that the proposed 

requirements would take time for plans 

and issuers to implement. Therefore, the 

Departments sought to strike an 

appropriate balance for the date by 

which plans and issuers must comply 

with final rules. The Departments noted 

that until the proposed applicability 

date, plans and issuers would be 

required to continue to comply with the 

most recent MHPAEA regulations 

codified in the CFR,126 as applicable. 

The Departments similarly proposed 

that the requirements in 26 CFR 

54.9812–2, 29 CFR 2590.712–1, and 45 

CFR 146.137 of the proposed rules, 

governing the requirements for 

comparative analyses under MHPAEA, 

would apply for plan years beginning on 

or after January 1, 2025. However, the 

Departments reminded plans and 

issuers that the statutory provisions 

added to MHPAEA by the CAA, 2021 

are self-implementing and took effect on 

February 10, 2021. As such, the 

proposed delayed applicability date for 

the comparative analysis requirements 

in the proposed rules would not alter a 

plan’s or issuer’s obligations under the 

statute. The Departments solicited 

comments on the proposed applicability 

dates. 

Several commenters stated that the 

proposals put forward sweeping 

changes to the existing rules. To allow 

time for implementation, commenters 

requested that the applicability date of 

the final rules for plans and issuers be 

for plan years beginning on or after 

January 1, 2026, or 2 years following 

publication of the final rules. Several 

commenters requested an 

implementation period ranging from 1 

to 2 years. Some of these commenters 

additionally requested a 1-year good 

faith enforcement safe harbor to allow 

plans and issuers additional time to 

comply with the new requirements. 

Another commenter requested that the 

proposed rules be effective in 2024, in 

order to not delay access to vital mental 

health and substance use disorder 

benefits. 

In order to effectuate these final rules 

in a timely manner and to ensure that 

participants and beneficiaries seeking 

benefits to treat mental health 

conditions or substance use disorders 

do not face a greater burden on access 

to mental health and substance use 

disorder benefits than medical/surgical 

benefits, while acknowledging the 

challenges to plans and issuers of 

implementing some of the requirements 

in these final rules, the Departments are 

finalizing the applicability provision, 

with some modifications. Accordingly, 

these final rules apply to group health 

plans (and health insurance coverage 

offered by an issuer in connection with 

a group health plan) on the first day of 

the first plan year beginning on or after 

January 1, 2025, except for the 

meaningful benefits standard, the 

prohibition on discriminatory factors 

and evidentiary standards, the relevant 

data evaluation requirements, and the 

related requirements in the provisions 

for comparative analyses, which apply 

on the first day of the first plan year 

beginning on or after January 1, 2026. 

Until these rules are applicable, plans 

and issuers must continue to comply 

with the regulations implementing 

MHPAEA as in effect prior to the 

effective date of these final rules, and 

must comply with the statutory 

provisions of MHPAEA, as amended by 

the CAA, 2021, both before and after 

these final rules become applicable. The 

Departments remind plans and issuers 

that guidance provided in FAQs Part 45 

addresses what information plans and 

issuers should make available under 

MHPAEA, as amended by the CAA, 

2021, in response to the Departments’ 

request for comparative analyses and 

can be relied on pending the 

applicability dates of these final rules. 

In response to the comments raising 

concerns about the magnitude of the 

changes of the proposed requirements in 

the proposed rules, particularly in 

relation to the amount of data collection 

and analysis that would be required and 

the time needed by plans and issuers to 

implement these changes, the 

Departments are delaying the 

applicability date with respect to certain 

provisions in these final rules, as 


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127 26 CFR 54.9812–2(c)(2)(ii)(C), (c)(5)(i)(C) and 

(D), and (c)(5)(ii) through (v); 29 CFR 2590.712– 

1(c)(2)(ii)(C), (c)(5)(i)(C) and (D), and (c)(5)(ii) 

through (v); and 45 CFR 137(c)(2)(ii)(C), (c)(5)(i)(C) 

and (D), and (c)(5)(ii) through (v). 

discussed in this section of the 

preamble. 

As part of the request to the 

Departments to extend the applicability 

date of these final rules, several 

commenters raised concerns regarding 

the amount of new documentation and 

the time necessary to implement the 

relevant data evaluation requirements, 

which, as noted earlier in this preamble, 

require plans and issuers to collect and 

evaluate data in a manner that is not 

currently required. The Departments 

acknowledge that the relevant data 

evaluation requirements and the related 

requirements in the provisions requiring 

the comparative analyses to demonstrate 

comparability and stringency, in 

operation, impose specific new 

obligations that plans and issuers must 

comply with in order to demonstrate 

that an NQTL with respect to mental 

health or substance use disorder 

benefits in any classification is no more 

restrictive in operation than the 

predominant NQTL that applies to 

substantially all medical/surgical 

benefits in the same classification. 

These final rules identify examples of 

relevant data that a plan or issuer may 

be required to collect, but ultimately the 

plan or issuer will need to determine 

which data must be collected and 

analyzed to comply with these final 

rules, whether any differences reflected 

in the data are material, and what 

reasonable actions to take, as necessary, 

when there are material differences in 

access to mental health and substance 

use disorder benefits as compared to 

medical/surgical benefits in the same 

classification. Similarly, the 

Departments recognize that the 

meaningful benefits standard under 

these final rules could impose new 

obligations for plans and issuers, which 

may require changes to benefit design 

that may be difficult to implement 

within a short period of time after the 

issuance of these final rules. 

Additionally, the Departments 

acknowledge that the prohibition on 

discriminatory factors may require plans 

and issuers to evaluate their NQTLs to 

determine whether such limitations are 

based on prohibited factors or 

evidentiary standards and whether 

changes need to be made to such factors 

or evidentiary standards in order to 

comply with these final rules. 

The Departments agree with 

commenters that this process will take 

time and that plans and issuers will face 

difficulty complying with these 

requirements by the start of a plan year 

beginning on or after January 1, 2025. 

Therefore, the Departments are delaying 

the applicability date for the meaningful 

benefits standard under 26 CFR 

54.9812–1(c)(2)(ii)(A), 29 CFR 

2590.712(c)(2)(ii)(A), and 45 CFR 

146.136(c)(2)(ii)(A); the prohibition on 

discriminatory factors and evidentiary 

standards under 26 CFR 54.9812– 

1(c)(4)(i)(B), 29 CFR 2590.712(c)(4)(i)(B), 

and 45 CFR 146.136(c)(4)(i)(B); the 

relevant data evaluation requirements 

under 26 CFR 54.9812–1(c)(4)(iii), 29 

CFR 2590.712(c)(4)(iii), and 45 CFR 

146.136(c)(4)(iii); and the related 

requirements in the provisions for 

comparative analyses; 127 to apply on 

the first day of the first plan year 

beginning on or after January 1, 2026. 

The Departments emphasize that plans 

and issuers must continue to comply 

with the 2013 final regulations until the 

respective applicability dates in these 

final rules. For example, even though 

the prohibition on discriminatory 

factors does not apply to plans and 

issuers until plan years beginning on or 

after January 1, 2026, plans and issuers 

should still be prepared to demonstrate 

that the factors used to design or apply 

an NQTL to mental health and 

substance use disorder benefits are 

comparable to and applied no more 

stringently than the factors used to 

design and apply an NQTL to medical/ 

surgical benefits in the same 

classification in accordance with the 

2013 final regulations. The Departments 

expect that plans and issuers will utilize 

the delayed applicability period to work 

in good faith to update systems and 

processes to comply with the new 

requirements of these final rules. 

Accordingly, the Departments 

encourage plans and issuers to start 

working to ensure that they are in a 

position to comply with all aspects of 

these final rules in a timely manner, 

including by working to comply with 

the meaningful benefits standard, the 

prohibition on discriminatory factors 

and evidentiary standards, and the 

relevant data evaluation requirements, 

as well as the associated comparative 

analysis requirements, no later than for 

plan years beginning on or after January 

1, 2026. 

D. Severability—26 CFR 54.9812–1(j), 29 

CFR 2590.712(j), and 45 CFR 146.136(j) 

and 26 CFR 54.9812–2(h), 29 CFR 

2590.712–1(h), and 45 CFR 146.137(h) 

The Departments proposed 

severability clauses in the proposed 

rules to capture the Departments’ intent 

that, to the extent a reviewing court 

holds that any provision of the final 

rules is unlawful by its terms or as 

applied to any person or circumstance, 

or stayed pending further agency action, 

the provision would be construed so as 

to continue to be given the maximum 

effect permitted by law. The 

Departments expressed their view that if 

the proposed rules were finalized as 

proposed or as a substantially similar 

version, such rules would provide 

comprehensive protections that 

implement MHPAEA’s requirements. 

The Departments noted that the aim of 

the proposed rules is to ensure that 

individuals with mental health 

conditions and substance use disorders 

benefit from the full protections 

afforded to them under MHPAEA, and 

that separate elements of the proposed 

rules would individually contribute to 

furthering that aim. Therefore, the 

Departments proposed that if a court 

were to hold that any provisions were 

invalid or unenforceable, any affected 

provisions would be severable from the 

rest of the proposed rules, if finalized, 

and would not affect any other 

provisions or their application to 

persons not similarly situated or to 

dissimilar circumstances. 

The Departments did not receive any 

comments relating to the proposed 

severability provisions and are 

finalizing these provisions without 

change. The Departments note that, 

while the requirements under 26 CFR 

54.9812–1(c)(4)(i) and (iii), 29 CFR 

2590.712(c)(4)(i) and (iii), and 45 CFR 

146.136(c)(4)(i) and (iii) are part of a 

comprehensive regulatory scheme, the 

provisions are separate aspects of the 

parity analysis and can continue to 

apply independently if other provisions 

of these final rules are invalidated. 

While the Departments have made some 

changes from the proposed rules in 

these final rules, as discussed earlier in 

this preamble, the Departments are not 

of the view that these changes affect the 

severability of the provisions of these 

final rules. 

E. Request for Information 

In the preamble to the proposed rules, 

the Departments requested information 

on ways to improve the coverage of 

mental health and substance use 

disorder benefits through other 

consumer protection laws, including the 

ACA. The Departments requested 

comments on ways to incentivize TPAs 

to facilitate compliance with MHPAEA 

on behalf of the plans that they design 

and administer and methods to enhance 

access to mental health and substance 

use disorder benefits through the 

Departments’ implementation of PHS 

Act section 2706(a), the provider 

nondiscrimination requirements. The 

Departments also requested comments 


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128PHS Act section 2722(a)(2); 45 CFR 146.180. 

129 Division FF, Title I, Subtitle C, Chapter 3, 

section 1321, Public Law 117–328, 136 Stat. 4459 

(Dec. 29, 2022). 

130PHS Act section 2722(a)(2)(F)(i). 

131PHS Act section 2722(a)(2)(F)(ii). 

132The statutory provisions implemented by 45 

CFR 146.180 became effective December 29, 2022 

(the date of enactment of the CAA, 2023). 

on ways that they could improve the 

coverage of and enhance access to 

mental health and substance use 

disorder benefits through their 

implementation of the provider 

directory requirements under Code 

section 9820(a) and (b), ERISA section 

720(a) and (b), and PHS Act section 

2799A–5(a) and (b), the requirements for 

telehealth, and the ways in which the 

Departments could leverage ERISA’s 

and the ACA’s existing claims 

procedure requirements to help 

facilitate access to mental health and 

substance use disorder benefits. Finally, 

the Departments requested information 

on whether HHS and the Treasury 

should consider potential amendments 

to the minimum value rule and on how 

behavioral health crisis services fit 

within the existing MHPAEA 

classifications or the EHB categories. 

The Departments appreciate the many 

comments received in response to the 

request for information and will use the 

comments to inform potential future 

rulemaking and guidance. 

III. Overview of the Final Rules— 

Department of HHS 

A. Sunset of MHPAEA Opt-Out for SelfFunded Non-Federal Governmental 

Plans 

Prior to the enactment of the CAA, 

2023 on December 29, 2022, sponsors of 

self-funded non-Federal governmental 

plans were permitted to elect to exempt 

those plans from (opt out of) compliance 

with the MHPAEA requirements, among 

other specified requirement categories, 

in title XXVII of the PHS Act.128

The CAA, 2023 included a provision 

that sunsets the election option with 

respect to MHPAEA.129 Specifically, 

that provision amended PHS Act section 

2722(a)(2) to specify that no MHPAEA 

opt-out election may be made on or after 

the date of the enactment of the CAA, 

2023, and that, subject to certain 

exceptions, no MHPAEA opt-out 

election expiring on or after the date 

that is 180 days after the date of such 

enactment may be renewed.130

The CAA, 2023 included an exception 

for certain collectively bargained plans 

with an opt-out election in effect for 

MHPAEA that allows for a longer 

transition to come into compliance with 

MHPAEA. Specifically, the CAA, 2023 

added language to PHS Act section 

2722(a)(2) indicating that a self-funded 

non-Federal governmental plan that is 

subject to multiple collective bargaining 

agreements of varying lengths that has a 

MHPAEA opt-out election in effect as of 

the date of enactment of the CAA, 2023, 

that expires on or after the date that is 

180 days after the enactment of the 

CAA, 2023, may extend such election 

until the date on which the term of the 

last such agreement expires.131

As a result of the CAA, 2023 

amendments to PHS Act section 

2722(a)(2), self-funded non-Federal 

governmental plan sponsors may elect 

to opt out of only the following three 

PHS Act requirement categories: 

standards relating to benefits for 

newborns and mothers (PHS Act section 

2725), required coverage for 

reconstructive surgery following 

mastectomies (PHS Act section 2727), 

and coverage for dependent students on 

a medically necessary leave of absence 

(PHS Act section 2728). 

In the proposed rules, HHS proposed 

to amend 45 CFR 146.180 to align with 

the CAA, 2023 amendments to PHS Act 

section 2722(a)(2). Specifically, HHS 

proposed to redesignate paragraphs 

(a)(3) through (7) as paragraphs (a)(4) 

through (8) and add a new paragraph 

(a)(3) specifying that a sponsor of a selffunded non-Federal governmental plan 

may not elect to exempt its plans from 

any of the MHPAEA requirements on or 

after December 29, 2022 (the date of 

enactment of the CAA, 2023), through 

the process specified in 45 CFR 146.180. 

HHS also proposed to add new 

paragraph (f)(4)(iii) specifying that in 

the case of a self-funded non-Federal 

governmental plan that is subject to 

multiple collective bargaining 

agreements of varying lengths and that 

has an election with respect to any of 

the MHPAEA requirements in effect as 

of December 29, 2022, through the 

process specified in 45 CFR 146.180, 

that expires on or after June 27, 2023 

(the date that is 180 days after the date 

of enactment of the CAA, 2023), the 

plan may extend such election until the 

date on which the term of the last such 

agreement expires. HHS also proposed 

to make conforming edits to paragraph 

(a)(2), paragraphs (a)(5)(i) and (ii) and 

(a)(6)(ii), as proposed to be redesignated, 

and paragraph (f)(1). HHS proposed that 

the amendments to 45 CFR 146.180 

would apply on the effective date of the 

final rule.132 HHS sought comments on 

these proposed amendments, including 

whether additional guidance or 

clarifications were necessary to 

implement the sunset of the MHPAEA 

opt-out election provision. 

Several commenters expressed 

support for the proposal to codify the 

sunset for sponsors of self-funded nonFederal governmental plans to opt out of 

compliance with the MHPAEA 

requirements. Many of these 

commenters recommended prioritizing 

MHPAEA compliance reviews of these 

plans as soon as their respective optouts are no longer valid. Furthermore, 

some commenters suggested these plans 

should immediately be requested to 

submit the NQTL comparative analyses 

required under PHS Act section 

2726(a)(8)(A) to ensure compliance with 

MHPAEA. One commenter encouraged 

HHS to oversee self-funded non-Federal 

governmental plans to ensure full 

MHPAEA compliance by such plans 

that previously opted out of compliance 

with the MHPAEA requirements. 

HHS appreciates the support for the 

proposed amendments to codify the 

sunset of the option for self-funded nonFederal governmental plans to elect to 

opt out of compliance with the 

MHPAEA requirements. HHS did not 

receive any comments objecting to the 

proposed amendments to 45 CFR 

146.180 and is finalizing those 

amendments as proposed in these final 

rules. HHS is committed to ensuring 

that self-funded non-Federal 

governmental plans that previously 

opted out of compliance with MHPAEA 

come into compliance with MHPAEA 

requirements. In determining the degree 

to which HHS will prioritize 

compliance reviews, NQTL comparative 

analysis reviews, and enforcement of 

MHPAEA with respect to self-funded 

non-Federal governmental plans once 

the plans’ respective opt-outs sunset, 

HHS will weigh all relevant 

considerations, such as the number of 

complaints of MHPAEA noncompliance 

with respect to such plans. 

One commenter suggested HHS 

implement a tiered approach to penalty 

assessment for compliance with 

MHPAEA that employs varying levels of 

penalties which consider the severity of 

and frequency of violations. This 

approach, according to the commenter, 

would encourage greater compliance as 

non-Federal governmental entities 

diligently work to modify their health 

plans, and would mitigate detrimental 

fiscal impacts that would reduce the 

ability of non-Federal governmental 

entities to both recruit and retain a 

strong workforce and continue to 

provide necessary services to residents. 

With respect to penalties for 

violations of MHPAEA and other PHS 

Act requirements, HHS has determined 

that the enforcement processes and 


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133HHS proposed amendments to the provisions 

in 45 CFR part 150 related to enforcement processes 

and procedures and penalties for noncompliance. 

86 FR 51730 (Sept. 16, 2021). 

134 45 CFR 150.305(b). 135 45 CFR 150.305(c). 

136Specifically, issuers must continue to comply 

with 45 CFR 147.160, incorporating 45 CFR 

146.136, each revised as of October 1, 2023. 

procedures set forth in existing 

regulations are sufficient to address the 

tiered approach to penalty assessment 

recommended by the commenter. The 

HHS enforcement processes and 

procedures applicable to self-funded 

non-Federal governmental plans are set 

forth at 45 CFR 150.301 through 

150.347. Rather than specifying a 

specific set penalty amount for any and 

all violations, the regulations at 45 CFR 

150.317, 150.319, 150.321, and 150.323 

specify the factors HHS uses in 

determining the amount of any penalty, 

including the entity’s previous record of 

compliance and the gravity of the 

violation; mitigating circumstances; 

aggravating circumstances; and other 

matters as justice may require.133 These 

factors allow HHS to structure penalties 

in a manner that encourages compliance 

while taking into account the relevant 

facts and circumstances. 

One commenter requested that HHS 

provide guidance on how self-funded 

non-Federal governmental plans can 

leverage the expertise of TPAs to 

comply with MHPAEA. 

HHS acknowledges that most selffunded group health plans contract with 

one or more TPAs to administer, and in 

some cases, to design plan benefits. To 

the extent a self-funded non-Federal 

governmental plan that contracts with a 

TPA has previously elected to opt out of 

MHPAEA compliance, HHS urges the 

sponsors of such plans to work with 

their TPAs to ensure that, under the 

plan’s contract with the administrator, if 

the TPA is required to administer 

benefits, it collects and analyzes data, 

and provides data to the sponsor in such 

a way that will enable the sponsor to 

comply with all the requirements of 

MHPAEA. HHS also notes that Federal 

regulations at 45 CFR 150.305 identify 

the entity liable for civil money 

penalties for noncompliance with 

applicable PHS Act requirements, 

including MHPAEA. Under the 

regulations, if a non-Federal 

governmental plan is sponsored by two 

or more employers and fails to comply 

with an applicable PHS Act 

requirement, the plan is subject to a 

civil money penalty, irrespective of 

whether the plan is administered by a 

health insurance issuer, an employer 

sponsoring the plan, or a TPA.134 If a 

non-Federal governmental plan is 

sponsored by a single employer and 

fails to comply with an applicable PHS 

Act requirement, the employer is subject 

to a civil money penalty, irrespective of 

whether the plan is administered by a 

health insurance issuer, the employer, 

or a TPA.135

B. Applicability of MHPAEA to 

Individual Health Insurance Coverage 

The HHS regulation implementing 

MHPAEA for individual health 

insurance coverage is codified at 45 CFR 

147.160. The regulation currently 

provides that the group market 

regulation implementing MHPAEA at 45 

CFR 146.136 applies to health insurance 

coverage offered by a health insurance 

issuer in the individual market in the 

same manner and to the same extent as 

such provisions apply to health 

insurance coverage offered by a health 

insurance issuer in connection with a 

group health plan in the large group 

market, for policy years beginning on or 

after the applicability date set forth in 

45 CFR 146.136(i). Therefore, through 

cross-reference, the proposed 

amendments to 45 CFR 146.136 would 

apply in the same manner to health 

insurance issuers offering individual 

health insurance coverage. Further, HHS 

proposed to include a cross reference in 

45 CFR 147.160 to the comparative 

analysis requirements that were 

proposed in 45 CFR 146.137. The cross 

reference would similarly make clear 

that the comparative analysis 

requirements apply to health insurance 

issuers offering individual health 

insurance coverage in the same manner 

that those provisions apply to group 

health plans and health insurance 

issuers offering coverage in connection 

with such plans. HHS proposed that 

these provisions would apply to health 

insurance issuers offering individual 

health insurance coverage for policy 

years beginning on or after January 1, 

2026. Finally, for greater clarity and 

precision and to align with the statutory 

terminology, HHS proposed to modify 

the regulation text to refer to 

‘‘individual health insurance coverage 

offered by a health insurance issuer’’ as 

opposed to ‘‘health insurance coverage 

offered in the individual market.’’ 

Commenters expressed support for 

HHS’ proposal to apply the proposed 

amendments to 45 CFR 146.136 in the 

same manner to individual health 

insurance coverage. HHS is finalizing 

this proposal as proposed. 

HHS received one comment 

supporting its proposal to include a 

cross reference in 45 CFR 147.160 to the 

comparative analysis requirements that 

were proposed in 45 CFR 146.137 to 

make clear that the comparative analysis 

requirements apply to health insurance 

issuers offering individual health 

insurance coverage in the same manner 

that those provisions apply to group 

health plans and health insurance 

issuers offering coverage in connection 

with such plans, and did not receive 

any comments opposing that proposal. 

HHS did not receive any comments on 

its proposal to modify the regulation 

text to refer to ‘‘individual health 

insurance coverage offered by a health 

insurance issuer’’ as opposed to ‘‘health 

insurance coverage offered in the 

individual market.’’ HHS is finalizing 

these proposals as proposed. 

With respect to HHS’ proposal that 

these provisions would apply to 

individual health insurance coverage for 

policy years beginning on or after 

January 1, 2026, one commenter stated 

that this applicability date should align 

with the applicability date for selffunded non-Federal governmental plans 

to come into compliance with 

MHPAEA’s requirements under PHS 

Act section 2726 and its implementing 

regulations, while other commenters 

requested that the applicability date for 

individual health insurance coverage be 

delayed until January 1, 2027. As stated 

in the proposed rules, nongrandfathered individual health 

insurance coverage must be offered on 

a calendar year basis. Premium rates 

must be submitted to the applicable 

regulator and finalized prior to January 

1 of each calendar year and rates cannot 

be modified during the year. The 

proposed applicability date is intended 

to provide time for issuers offering 

individual health insurance coverage to 

account for the effects of these rules 

following publication of the final rules, 

which precludes alignment with the 

applicability date for self-funded nonFederal governmental plans, and prior 

to when rates and benefits must be 

finalized and approved for the following 

calendar year. In addition, HHS declines 

to delay the applicability date until 

January 1, 2027, in order to ensure the 

protections of these final rules apply in 

a timely manner. Therefore, with 

respect to its proposal that these 

provisions would apply to individual 

health insurance coverage, HHS is 

finalizing the applicability date of 

January 1, 2026, as proposed. 

Until the applicability date, issuers 

are required to continue to comply with 

the most recent MHPAEA regulations 

codified in the CFR136 and must comply 

with the statutory provisions of 

MHPAEA, as amended by the CAA, 

2021, both before and after these final 


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77656 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

137The Department of the Treasury is not 

included as part of the Departments in the 

regulatory impact analysis. 

138Regulatory Planning and Review, 58 FR 51735 

(Oct. 4, 1993). 

139 Improving Regulation and Regulatory Review, 

76 FR 3821 (Jan. 18, 2011). 

140Modernizing Regulatory Review, 88 FR 21879 

(Apr. 6, 2023). 

141 44 U.S.C. 3506(c)(2)(A) (1995). 

142 5 U.S.C. 601 et seq. (1980). 

143 2 U.S.C. 1501 et seq. (1995). 

144Federalism, 64 FR 153 (Aug. 4, 1999). 

145 5 U.S.C. 801 et seq. (1996). 

146Modernizing Regulatory Review, 88 FR 21879 

(Apr. 6, 2023). 

147Commonwealth Fund, Behavioral Health Care 

in the United States: How It Works and Where It 

Falls Short (Sept. 7, 2022), https://www.common

wealthfund.org/publications/explainer/2022/sep/ 

behavioral-health-care-us-how-it-works-where-itfalls-short. 

148SAMHSA, Center for Behavioral Health 

Statistics and Quality, National Survey on Drug Use 

and Health, Table 6.21B (2022), https://

www.samhsa.gov/data/sites/default/files/reports/ 

rpt42728/NSDUHDetailedTabs2022/ 

NSDUHDetailedTabs2022/NSDUHDet

TabsSect6pe2022.htm. 

149 Government Accountability Office (GAO), 

Behavioral Health: Research on Health Care Costs 

of Untreated Conditions is Limited, GAO–19–274 

(Feb. 2019), https://www.gao.gov/assets/gao-19- 

274.pdf. 

150Lucas Godoy Garraza, Christine Walrath, 

Simone Peart Boyce, & David Goldston, An 

Economic Evaluation of the Garrett Lee Smith 

Memorial Suicide Prevention Programs, 48(1) 

Suicide and Life-Threatening Behavior (2018), 

https://onlinelibrary.wiley.com/doi/10.1111/ 

sltb.12321. 

151SAMHSA, Center for Behavioral Health 

Statistics and Quality, National Survey on Drug Use 

and Health, Figure 64 (2022), https://

www.samhsa.gov/data/sites/default/files/reports/ 

rpt42731/2022-nsduh-nnr.pdf. 

152SAMHSA, Center for Behavioral Health 

Statistics and Quality, National Survey on Drug Use 

and Health, Table A.47B (2022), https://

www.samhsa.gov/data/sites/default/files/reports/ 

rpt42731/2022-nsduh-nnr.pdf. Respondents could 

indicate multiple reasons for not receiving 

treatment and so response categories are not 

mutually exclusive. 

rules become applicable. HHS reminds 

issuers that the guidance in FAQs Part 

45 addresses what information plans 

and issuers should make available 

under MHPAEA, as amended by the 

CAA, 2021, in response to the 

Departments’ request for comparative 

analyses and can be relied on pending 

the applicability date of these final 

rules. 

IV. Regulatory Impact Analysis 

Summary—Departments of Health and 

Human Services and Labor 

The Departments 137 have examined 

the impacts of these final rules as 

required by Executive Order 12866,138

Executive Order 13563,139 Executive 

Order 14094,140 the Paperwork 

Reduction Act of 1995,141 the 

Regulatory Flexibility Act,142 section 

202 of the Unfunded Mandates Reform 

Act of 1995,143 Executive Order 

13132,144 and the Congressional Review 

Act.145

1. Executive Orders 12866 and 13563— 

Departments of Health and Human 

Services and Labor 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives and, if regulation is 

necessary, select regulatory approaches 

that maximize net benefits (including 

potential economic, environmental, 

public health and safety effects; 

distributive impacts; and equity). 

Executive Order 13563 emphasizes the 

importance of quantifying costs and 

benefits, reducing costs, harmonizing 

rules, and promoting flexibility. 

Under Executive Order 12866, 

‘‘significant’’ regulatory actions are 

subject to review by the Office of 

Management and Budget (OMB). As 

amended by Executive Order 14094,146

entitled ‘‘Modernizing Regulatory 

Review,’’ section 3(f) of the Executive 

order defines a ‘‘significant regulatory 

action’’ as any regulatory action that is 

likely to result in a rule that may: 

(1) have an annual effect on the 

economy of $200 million or more 

(adjusted every 3 years by the 

Administrator of the Office of 

Information and Regulatory Affairs 

(OIRA) for changes in gross domestic 

product); or adversely affect in a 

material way the economy, a sector of 

the economy, productivity, competition, 

jobs, the environment, public health or 

safety, or State, local, Territorial, or 

Tribal governments or communities; 

(2) create a serious inconsistency or 

otherwise interfere with an action taken 

or planned by another agency; 

(3) materially alter the budgetary 

impacts of entitlement grants, user fees, 

or loan programs or the rights and 

obligations of recipients thereof; or 

(4) raise legal or policy issues for 

which centralized review would 

meaningfully further the President’s 

priorities or the principles set forth in 

this Executive order, as specifically 

authorized in a timely manner by the 

Administrator of OIRA in each case. 

Based on the Departments’ estimates, 

OMB’s OIRA has determined this 

rulemaking is significant per section 

3(f)(1) as measured by the $200 million 

or more in any one year. Therefore, the 

Departments have provided an 

assessment of the potential costs, 

benefits, transfers, and alternatives 

associated with these final rules, and 

OMB has reviewed these final rules. 

2. Introduction and Need for 

Regulations 

Mental health is crucial to a person’s 

overall well-being, and access to quality 

mental health and substance use 

disorder treatment is as essential for 

health as access to medical/surgical 

treatment.147 According to the NSDUH, 

in 2022, 50.6 percent of adults in the 

United States with any mental illness 

had received treatment within the past 

year; 66.7 percent of adults with a 

serious mental illness had received 

treatment.148

Failure to treat mental health 

conditions or substance use disorders 

can be costly. For example, depression 

is associated with increased risk of 

cardiovascular disease, diabetes, stroke, 

Alzheimer’s disease, suicidality, and 

osteoporosis, and an untreated 

substance use disorder may result in 

hospital emergency room care for a drug 

overdose.149 One study examined the 

costs and benefits of 58 grants provided 

through the Garrett Lee Smith Memorial 

Suicide Prevention Program (GPP) 

between 2005 and 2009, which provides 

Federal funding to States, Tribes, and 

colleges for community-based suicide 

prevention programs. The study 

estimated that the programs resulting 

from GPP funding prevented 79,379 

suicide attempts and resulted in $4.50 

in medical cost savings for each dollar 

invested.150

Individuals with mental health 

conditions or substance use disorders 

have faced stigma, discrimination, and 

other barriers inside and outside of the 

health care system, which can operate 

as impediments to seeking and 

obtaining treatment. In 2022, 

approximately 27 percent of adults 18 

and older with any mental illness in the 

past year who did not receive mental 

health treatment reported a perceived 

unmet need for treatment.151

Individuals reported a variety of reasons 

for not receiving treatment: 59 percent 

thought it would cost too much; 26 

percent were concerned their 

information would not be kept private; 

20 percent were unable to get an 

opening in the treatment program or 

with the health care professional they 

wanted to see; 16 percent thought it may 

cause their community to have a 

negative opinion about them; and 15 

percent thought it might impact their 

job, parental rights or housing.152

The Departments are particularly 

concerned with access barriers for 

individuals seeking mental health or 

substance use disorder treatments. A 

2022 Harris Poll sponsored by the 

National Council for Mental Wellbeing 

found that 21 percent of adults with 

unmet mental health care needs in the 


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153National Council for Mental Wellbeing, 2022 

Access to Care Survey Results (May 11, 2022), 

https://www.thenationalcouncil.org/wp-content/

uploads/2022/05/2022-Access-To-Care-SurveyResults.pdf. 

154 KFF, 2023 Employer Health Benefits Survey 

(Oct. 18, 2023), https://www.kff.org/report-section/ 

ehbs-2023-section-13-employer-practicestelehealth-provider-networks-coverage-limits-andcoverage-for-abortion/. 

155Health Affairs, Combating a Crisis by 

Integrating Mental Health Services and Primary 

Care, Health Affairs Forefront (July 8, 2022), https:// 

www.healthaffairs.org/do/10.1377/

forefront.20220706.603540. 

156 Danielle F. Loeb, Elizabeth A. Bayliss, Ingrid 

A. Binswanger, Carey Candrian, & Frank V. Degruy, 

Primary Care Physician Perceptions on Caring for 

Complex Patients with Medical and Mental Illness, 

27(8) Journal of General Internal Medicine pp. 945– 

952 (2012), https://www.ncbi.nlm.nih.gov/pmc/ 

articles/PMC3403152/; Lusine Poghosyan, Allison 

A. Norful, Affan Ghaffari, Maureen George, Shruti 

Chhabra, Mark Olfson, Mental Health Delivery in 

Primary Care: The Perspectives of Primary Care 

Providers, 33(5) Archives of Psychiatric Nursing pp. 

63–67 (Oct. 2019), https://www.ncbi.nlm.nih.gov/ 

pmc/articles/PMC7077950. 

157Tami L. Mark & William Parish, Behavioral 

Health Parity—Pervasive Disparities in Access to InNetwork Care Continue, RTI International (2024), 

https://dpjh8al9zd3a4.cloudfront.net/publication/

behavioral-health-parity-pervasive-disparitiesaccess-network-care-continue/fulltext.pdf. 

158Susan H. Busch & Kelly Kyanko, Assessment 

of Perceptions of Mental Health vs Medical Health 

Plan Networks Among US Adults with Private 

Insurance, 4(10) JAMA Network Open (2021). 

159 Davenport, Stoddard, Travis Gray, & Stephen 

P. Melek, Addiction and Mental Health vs. Physical 

Health: Widening Disparities in Network Use and 

Provider Reimbursement, Milliman (Nov. 20, 2019), 

https://www.milliman.com/en/insight/addictionand-mental-health-vs-physical-health-wideningdisparities-in-network-use-and-p/. 

160Tara F. Bishop, Joanna K. Seirup, Harold Alan 

Pincus, & Joseph S. Ross, Population of US 

Practicing Psychiatrists Declined, 2003–13, Which 

May Help Explain Poor Access to Mental Health 

Care, 35(7) Health Affairs (Millwood) (2016) pp. 

1271–1277. 

161 Daria Pelech & Tamara Hayford. Medicare 

Advantage and Commercial Prices for Mental 

Health Services, 38(2) Health Affairs (Millwood) 

(2019) pp. 262–267. 

162Sarah A. Friedman, Haiyong Xu, Francisca 

Azocar, & Susan L. Ettner, Quantifying Balance 

Billing for Out-of-Network Behavioral Health Care 

in Employer-Sponsored Insurance, 73(9) Psychiatric 

Services pp. 1019–1026 (2022). 

163American Psychological Association, Stress in 

America 2023: A Nation Recovering from Collective 

Trauma (Nov. 2023), https://www.apa.org/news/ 

press/releases/stress/2023/collective-traumarecovery. 

164Michael Daly, Prevalence of Depression 

Among Adolescents in the US from 2009 to 2019: 

Analysis of Trends by Sex, Race/Ethnicity, and 

Income, 70 Journal of Adolescent Health 3 pp. 496– 

499 (2022). Additional information regarding these 

trends in mental health services among children 

and adolescents is addressed earlier in this 

preamble. 

165Public Law 116–260 (Dec. 27, 2020). 

166NQTLs consist of any limitations on the scope 

and duration of benefits that are not expressed 

numerically. Because they are non-quantitative, it 

can be difficult to measure their impact on 

restricting access and whether they are applied in 

parity across mental health and substance use 

disorder benefits and medical/surgical benefits. 

167 2022 MHPAEA Report to Congress, https://

www.dol.gov/sites/dolgov/files/EBSA/laws-andregulations/laws/mental-health-parity/report-tocongress-2022-realizing-parity-reducing-stigmaand-raising-awareness.pdf. 

168 2023 MHPAEA Comparative Analysis Report 

to Congress, www.dol.gov/sites/dolgov/files/EBSA/

laws-and-regulations/laws/mental-health-parity/ 

report-to-congress-2023-mhpaea-comparativeanalysis.pdf. 

past year and 28 percent of those with 

unmet substance use disorder care 

needs in the past year reported that their 

inability to get an immediate 

appointment had prevented them from 

getting needed care.153

Obtaining appointments with primary 

care physicians instead of behavioral 

health specialists can be significantly 

easier. According to the 2023 KFF 

Employer Health Benefits Survey, 91 

percent of firms that offer physical 

health benefits believe there is a 

sufficient number of primary care 

providers in the plans’ network, 

whereas only 67 percent and 59 percent, 

respectively, believe there is a sufficient 

number of mental health providers and 

substance use disorder providers.154

However, while up to 70 percent of all 

primary care visits include a behavioral 

health component,155 research suggests 

that primary care providers face 

significant barriers to delivering these 

services, including insufficient 

resources, inadequate related 

knowledge, and limited time with 

patients.156

In seeking out specialists, individuals 

tend to face less adequate mental health 

provider networks than medical/ 

surgical provider networks through their 

plan or coverage. A 2024 study of 2019– 

2021 claims and enrollment data for 

employer-sponsored health plans 

reported that office visits with 

psychiatrists and psychologists occurred 

out-of-network 8.9 and 10.6 times more, 

respectively, than those with medical/ 

surgical specialist physicians.157

According to a 2021 study, which 

compared the experiences of patients 

receiving both specialty mental health 

and medical/surgical care, patients who 

were receiving mental health treatment 

from only a mental health practitioner 

were more likely to rate their plan’s 

mental health network as inadequate 

compared with their plan’s medical/ 

surgical provider network.158 The study 

referenced research that found specialty 

mental health networks tend to be 

narrower due to a growing workforce 

shortage of mental health providers, a 

high demand for mental health services, 

and specialty mental health 

practitioners opting out of participating 

in provider networks due to low 

reimbursements for mental health 

services compared with other 

specialties. These factors have 

consequentially resulted in higher outof-network utilization rates for mental 

health care services.159 160 161

Use of out-of-network providers can 

place additional burdens on families 

seeking mental health and substance use 

disorder treatments. A 2022 study of 

families experiencing out-of-network 

behavioral health expenditures in their 

employer-sponsored insurance claims 

found that roughly half of the families 

were subject to ‘‘balance billing,’’ with 

the yearly mean total for those families 

being $861. This study, however, 

focused on out-of-network claims 

submitted by providers to insurers, 

which suggests that, for individuals 

seeking treatment from behavioral 

health care from providers not accepting 

insurance, the out-of-pocket costs could 

be even greater.162

Despite access barriers to seeking 

mental health and substance use 

disorder treatment, the need for these 

services has only increased. An 

estimated 37 percent of U.S. adults 

reported being diagnosed with a mental 

health condition in 2023, a 

5-percentage-point increase from prepandemic levels in 2019.163 Research 

suggests that the need for mental health 

services has also increased among 

children and adolescents. For instance, 

a 2022 study using 2009 to 2019 data 

from the NSDUH found that the 

prevalence of a major depressive 

episode among adolescents aged 12 to 

17 increased by 7.7 percentage points, 

from approximately 8.1 percent in 2009 

to 15.8 percent in 2019. The study 

found that the increase in prevalence of 

major depressive episodes was even 

higher among female adolescents, 

finding a 12.0-percentage-point 

increase.164

The enactment of MHPAEA, as well 

as the CAA, 2021 165 and associated 

regulations and guidance issued by the 

Departments, were intended to assist 

plans and issuers in improving their 

policies and procedures to ensure parity 

between mental health and substance 

use disorder benefits and medical/ 

surgical benefits, particularly with 

regards to applying NQTLs.166 However, 

as documented in the past two Reports 

to Congress 167 168 and discussed later in 

this regulatory impact analysis, the 

Departments have found from their 

initial reviews that plans and issuers 

failed to comply with these 

requirements. 

In order to address these issues and 

improve the health and well-being of 

both individuals and their communities, 

the Departments are committed to 

promoting equal access to treatment for 


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77658 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

169 74 FR 19155 (Apr. 28, 2009). 

170 75 FR 5410 (Feb. 2, 2010). 

171 78 FR 68240 (Nov. 13, 2013). 

172SAMHSA, Know Your Rights: Parity for 

Mental Health and Substance Use Disorder Benefits 

(2022), https://store.samhsa.gov/product/knowyour-rights-parity-mental-health-and-substanceuse-disorder-benefits/pep21-05-00-003; SAMHSA, 

The Essential Aspects of Parity: A Training Tool for 

Policymakers (2022), https://store.samhsa.gov/ 

product/essential-aspects-parity-training-toolpolicymakers/pep21-05-00-001; DOL, 

Understanding Your Mental Health and Substance 

Use Disorder Benefits, https://www.dol.gov/ 

agencies/ebsa/about-ebsa/our-activities/resourcecenter/publications/understanding-your-mentalhealth-and-substance-use-disorder-benefits. 

173FAQs about Mental Health and Substance Use 

Disorder Parity Implementation and the 

Consolidated Appropriations Act, 2021 Part 45 

(Apr. 2, 2021), https://www.dol.gov/sites/dolgov/ 

files/EBSA/about-ebsa/our-activities/resourcecenter/faqs/aca-part-45.pdf and https://

www.cms.gov/cciio/resources/fact-sheets-and-faqs/ 

downloads/mhpaea-faqs-part-45.pdf. 

174 2022 MHPAEA Report to Congress, https://

www.dol.gov/sites/dolgov/files/EBSA/laws-andregulations/laws/mental-health-parity/report-tocongress-2022-realizing-parity-reducing-stigmaand-raising-awareness.pdf. 

175 2023 MHPAEA Comparative Analysis Report 

to Congress, www.dol.gov/sites/dolgov/files/EBSA/ 

laws-and-regulations/laws/mental-health-parity/ 

report-to-congress-2023-mhpaea-comparativeanalysis.pdf. 

mental health conditions and substance 

use disorders. These final rules, by 

clarifying requirements for comparative 

analyses and setting forth additional 

requirements for how NQTLs must be 

designed and applied for group health 

plans and health insurance coverage, 

will serve to improve compliance with 

MHPAEA by plans and issuers. This 

will in turn promote more equitable 

access to affordable and comprehensive 

care for individuals with mental health 

conditions and substance use disorders 

and reduce barriers to mental health and 

substance use disorder treatments, 

resulting in greater access and 

utilization of these services as well as 

better patient outcomes. 

2.1. History of MHPAEA Related 

Government Actions 

To implement the requirements of 

MHPAEA, the Departments published a 

request for information soliciting 

comments on issues under MHPAEA in 

2009 169 and interim final regulations in 

2010.170 After considering the 

comments and other feedback received 

from interested parties, the Departments 

published the 2013 final regulations.171

In subsequent years, the Departments 

provided extensive guidance and 

compliance assistance materials to the 

regulated community, State regulators, 

and other interested parties to facilitate 

the implementation and enforcement of 

MHPAEA, including the 2020 MHPAEA 

Self-Compliance Tool, which provided a 

basic framework for plans and issuers to 

assess whether their NQTLs satisfy 

MHPAEA’s parity requirements. The 

Departments also have provided 

materials to educate consumers, their 

family members, and policymakers 

about parity for mental health and 

substance use disorder benefits,172 and 

may develop new materials and 

undertake additional educational efforts 

as necessary after the publication of 

these final rules. 

The CAA, 2021 amended MHPAEA, 

in part, by expressly requiring group 

health plans and health insurance 

issuers that provide both medical and 

surgical benefits and mental health or 

substance use disorder benefits and 

impose NQTLs on mental health or 

substance use disorder benefits to 

perform and document their 

comparative analyses of the design and 

application of NQTLs. Plans and issuers 

must provide those analyses to the 

Departments or applicable State 

authorities, upon request. Moreover, the 

CAA, 2021 compels the Departments to 

request and evaluate no fewer than 20 

NQTL comparative analyses per year 

and submit to Congress and make 

available to the public an annual report 

summarizing the Departments’ review 

process and findings. Shortly after the 

enactment of the amendments to 

MHPAEA made by the CAA, 2021, the 

Departments issued FAQs Part 45 to 

help plans and issuers comply with the 

comparative analysis requirements.173

As documented in the 2022 MHPAEA 

Report to Congress,174 the Departments 

found that under the first year of the 

CAA, 2021, none of the NQTL 

comparative analyses they reviewed 

contained sufficient information and 

documentation from plans and issuers 

upon initial receipt. Similarly, the 2023 

MHPAEA Comparative Analysis Report 

to Congress 175 notes that nearly all the 

comparative analyses reviewed by the 

Departments contained insufficient 

information upon initial receipt and 

identified common deficiencies in the 

comparative analyses prepared by plans 

and issuers. Moreover, despite plans’ 

and issuers’ longstanding obligations 

under MHPAEA to ensure that the 

processes, strategies, evidentiary 

standards, and other factors used to 

apply NQTLs are equitable, it was 

apparent upon review of the analyses, 

that plans and issuers had not carefully 

designed and implemented their NQTLs 

to be compliant with MHPAEA prior to 

the enactment of the CAA, 2021. Many 

plans and issuers appeared to generate 

their analyses for the first time in 

response to the Departments’ requests, 

rather than in advance, as required by 

law and as a critical part of the design 

and application of a MHPAEAcompliant NQTL. Consequently, the 

comparative analyses appeared to focus 

on finding after-the-fact rationales for 

decisions and designs involving NQTLs, 

rather than reflecting proper attention to 

MHPAEA compliance in the first place. 

The Departments are committed to 

ensuring parity in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits. By issuing these final 

rules, the Departments will provide 

additional guidance to affected parties 

to facilitate compliance with MHPAEA 

and to help ensure that individuals with 

mental health conditions and substance 

use disorders benefit from the full 

protections required by law consistent 

with the fundamental purpose of 

MHPAEA. 

2.2. Current Regulatory Actions 

These final rules amend existing 

regulatory definitions and add new 

definitions of key terms, including 

‘‘factors,’’ ‘‘processes,’’ ‘‘strategies,’’ and 

‘‘evidentiary standards.’’ They also add 

more specificity as to what conditions 

or disorders plans and issuers must treat 

as mental health conditions and 

substance use disorders for purposes of 

MHPAEA to be consistent with 

generally recognized independent 

standards of current medical practice. 

These final rules also clarify the way the 

parity requirements apply to NQTLs, 

including by prohibiting discriminatory 

factors and evidentiary standards, and 

provide additional examples of the 

application of MHPAEA to NQTLs to 

improve the understanding and ability 

of the regulated community to comply 

with the law. Additionally, these final 

rules require that plans and issuers 

provide meaningful benefits for covered 

mental health conditions and substance 

use disorders in each classification in 

which meaningful medical/surgical 

benefits are provided. 

Under these final rules, plans and 

issuers are required to collect and 

evaluate relevant data in a manner 

reasonably designed to assess the 

impact of the NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits. 

These final rules provide guidance for 

how to comply with the relevant data 

evaluation requirements in limited 

circumstances where data is initially 

and temporarily unavailable for new 

and newly imposed NQTLs and where 

no data exists that can reasonably 

measure any relevant impact of the 

NQTL on relevant outcomes related to 

access to mental health and substance 

use disorder benefits and medical/ 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77659 

176 2023 MHPAEA Comparative Analysis Report 

to Congress, https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/laws/mental-healthparity/report-to-congress-2022-realizing-parityreducing-stigma-and-raising-awareness.pdf. 

177FAQs Part 45, Q6. 178 2022 MHPAEA Report to Congress, https://

www.dol.gov/sites/dolgov/files/EBSA/laws-andregulations/laws/mental-health-parity/report-tocongress-2022-realizing-parity-reducing-stigmaand-raising-awareness.pdf. 179 2023 MHPAEA Comparative Analysis Report 

to Congress, www.dol.gov/sites/dolgov/files/EBSA/ 

laws-and-regulations/laws/mental-health-parity/ 

report-to-congress-2023-mhpaea-comparativeanalysis.pdf. 

surgical benefits. In those instances, the 

plan or issuer must include specific 

information in their comparative 

analyses, as explained earlier in this 

preamble. 

These final rules also set forth specific 

content requirements for comparative 

analyses required by the CAA, 2021, 

and outline the process for plans and 

issuers to provide their comparative 

analyses to the Departments or an 

applicable State authority upon request. 

Additionally, in these final rules, HHS 

finalizes regulatory amendments to 

implement a provision in the CAA, 2023 

that sunsets the election option for 

sponsors of self-funded non-Federal 

governmental plans to opt out of 

requirements under MHPAEA. 

In their reviews of plans’ and issuers’ 

comparative analyses under the 

requirements of the CAA, 2021, the 

Departments identified exclusions 

related to treatment for ASD with ABA 

therapy and OUD with medication 

assisted treatment, as well as 

gatekeeping provisions for treatment 

applied with respect to mental health or 

substance use disorder benefits but not 

to medical/surgical benefits, such as 

requiring referrals for appointments and 

prior authorization for mental health 

and substance use disorder outpatient 

services, resulting in corrections by the 

plans and issuers.176 However, the 

comparative analyses alone are often 

less effective in identifying substantive 

parity violations for more complex 

NQTLs, such as those related to network 

composition. The Departments expect 

that these additional requirements will 

provide plans and issuers with a better 

understanding of the requirements of 

MHPAEA with respect to NQTLs and 

improve how they measure, compare, 

and demonstrate parity, while clarifying 

appropriate ways for plans and issuers 

to modify their policies and procedures 

to meet parity requirements. As such, 

these final rules will help plans and 

issuers comply with these requirements, 

increase the ability of plans and issuers 

to provide compliant comparative 

analyses during future reviews or 

investigations, and result in improved 

access to treatment and coverage of 

mental health conditions and substance 

use disorders, as intended by MHPAEA. 

3. Baseline 

The baseline for this analysis includes 

the MHPAEA statute, as amended, 

implementing regulations, and 

subsequent guidance. Benefits, costs, 

and transfers are measured as changes 

from the baseline under these final 

rules. For example, the CAA, 2021 

requires that plans and issuers perform 

and document NQTL comparative 

analyses. Starting 45 days after the 

enactment of the CAA, 2021, plans and 

issuers were required to make their 

comparative analyses available to the 

Departments or an applicable State 

authority upon request. Plans and 

issuers are further required to make 

these comparative analyses and other 

applicable information required by the 

CAA, 2021 available upon request to 

participants, beneficiaries, and enrollees 

in all non-grandfathered group health 

plans and non-grandfathered group or 

individual health insurance coverage 

(including a provider or other person 

acting as a participant’s, beneficiary’s, 

or enrollee’s authorized representative) 

in connection with an adverse benefit 

determination, as well as to participants 

and beneficiaries in plans subject to 

ERISA.177

The 2022 and 2023 MHPAEA Reports 

to Congress documented that many 

comparative analyses prepared by plans 

and issuers prior to these final rules 

were deficient even after multiple 

requests for correction by the 

Departments.178 179 In addition, at least 

some plans and issuers failed to conduct 

the required comparative analyses until 

after the Departments requested them, 

rather than performing and 

documenting them prospectively within 

45 days following the enactment of the 

CAA, 2021. 

The Departments’ view is that plans 

and issuers that were already timely 

fulfilling the comparative analysis 

requirements outlined in CAA, 2021 

will incur only incremental costs to 

comply with these final rules. Plans and 

issuers not already meeting those 

requirements may, on the other hand, 

face significant costs to come into 

compliance with the CAA, 2021 

comparative analysis requirements and 

these final rules. However, because 

those actions to comply with the CAA, 

2021 comparative analysis requirements 

would need to occur absent these final 

rules, those costs are included in the 

baseline. 

Therefore, this regulatory impact 

analysis does not include benefits or 

costs for performing and documenting 

comparative analyses for NQTLs 

applicable to mental health and 

substance use disorder benefits and 

medical/surgical benefits, or making 

them available upon request, as these 

are already required by the provisions of 

the CAA, 2021 and are in the baseline. 

However, this regulatory impact 

analysis does take into account the 

expected impacts of these final rules on 

the preparation of plans’ and issuers’ 

comparative analyses, how these final 

rules will impact plans’ and issuers’ 

compliance and, in turn, access for 

participants, beneficiaries, and enrollees 

needing mental health and substance 

use disorder treatments, and whether 

plans and issuers need to change their 

policies and procedures to provide 

benefits in parity. 

Some commenters stated that the 

proposal would require plans and 

issuers to substantially revise their 

comparative analyses, arguing the 

significance of those revisions makes 

the Departments’ approach of 

conducting an incremental analysis of 

the additional requirements of this 

rulemaking inappropriate. In particular, 

one commenter stated that the 

imposition of the new ‘‘substantially 

all’’ test would require all comparative 

analyses to be redone, thereby imposing 

the full cost of performing these 

analyses under the proposed rules. In 

response, the Departments note that, as 

discussed earlier in this preamble, they 

are not finalizing the proposed 

mathematical tests for applying the 

substantially all and predominant tests, 

which would have based these 

determinations on the dollar amount of 

all plan payments for medical/surgical 

benefits expected to be paid. Instead, 

these final rules provide that an NQTL 

with respect to mental health or 

substance use disorder benefits is more 

restrictive, as written or in operation, 

than the predominant NQTL that 

applies to substantially all medical/ 

surgical benefits in the same 

classification if the plan or issuer fails 

to satisfy the design and application 

requirements or the relevant data 

evaluation requirements. Additionally, 

the material differences standard in the 

relevant data evaluation requirements 

reflects an interpretation of the statutory 

terms ‘‘substantially all’’ and 

‘‘predominant’’ in a manner that takes 

into account the multi-faceted nature of 

NQTLs, as well as the complexity of 

analyzing such NQTLs. 

Because the CAA, 2021 requires that 

comparative analyses be performed and 

documented, the fact that plans and 

issuers were not adequately conducting 

the required analyses and documenting 


khammond on DSKJM1Z7X2PROD with RULES2
77660 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

180 2022 MHPAEA Report to Congress, https://

www.dol.gov/sites/dolgov/files/EBSA/laws-andregulations/laws/mental-health-parity/report-tocongress-2022-realizing-parity-reducing-stigmaand-raising-awareness.pdf. 

181 2023 MHPAEA Comparative Analysis Report 

to Congress, www.dol.gov/sites/dolgov/files/EBSA/ 

laws-and-regulations/laws/mental-health-parity/ 

report-to-congress-2023-mhpaea-comparativeanalysis.pdf. 

182 K. John McConnell, M. Susan Ridgely, & 

Dennis McCarty, What Oregon’s Parity Law Can 

Tell Us About the Federal Mental Health Parity and 

Addiction Equity Act and Spending on Substance 

Abuse Treatment Services, 124(3) Drug and Alcohol 

Dependence pp. 340–346 (2012). 

183Hefei Wen, Janet R. Cummings, Jason M. 

Hockenberry, Laura M. Gaydos, & Benjamin G. 

Druss, State Parity Laws and Access to Treatment 

for Substance Use Disorder in the United States: 

Implications for Federal Parity Legislation, 70 (12) 

JAMA Psychiatry pp. 1355–1362 (2013). 

how they determined NQTLs were being 

applied in parity, is not a justification 

for why these final rules should account 

for the full cost of those actions. Rather, 

these final rules consider as the baseline 

what plans and issuers should have 

done given the relevant statute and 

guidance irrespective of these final 

rules. Therefore, for this category of 

cost, the effect of these final rules is 

limited to those additional requirements 

included by the Departments in the final 

rules. Estimates are made based on the 

impact from the baseline on plans and 

issuers affected by these final rules, and 

assuming full compliance with the new 

requirements. 

4. Summary of Impacts 

These final rules define certain terms 

associated with MHPAEA’s 

requirements for NQTLs and require 

that plans and issuers provide 

meaningful benefits for covered mental 

health conditions and substance use 

disorders in each classification in which 

meaningful medical/surgical benefits 

are provided. These final rules also 

provide that a group health plan (or 

health insurance coverage offered by an 

issuer in connection with a group health 

plan) may not impose any NQTL with 

respect to mental health or substance 

use disorder benefits in any 

classification that is more restrictive, as 

written and in operation, than the 

predominant NQTL that applies to 

substantially all medical/surgical 

benefits in the same classification. For 

this purpose, the plan and issuer must 

ensure that the NQTL satisfies both the 

design and application requirements 

and the relevant data evaluation 

requirements. Specifically, under these 

final rules, plans and issuers must 

continue to satisfy the design and 

application requirements from the 2013 

final regulations, which require an 

analysis of the processes, strategies, 

evidentiary standards, and other factors 

used to design and apply NQTLs to 

mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits. Plans and 

issuers have struggled with these 

requirements, as detailed in the 

Departments’ 2022 MHPAEA Report to 

Congress 180 and the 2023 MHPAEA 

Comparative Analysis Report to 

Congress.181 Additionally, plans and 

issuers are not permitted to use any 

discriminatory factors or evidentiary 

standards to design or apply an NQTL, 

and they must satisfy new relevant data 

evaluation requirements as well as new 

requirements related to the elements 

and documentation of their comparative 

analyses. 

In particular, to comply with the 

required content elements for a 

comparative analysis, plans and issuers 

must describe each NQTL and identify 

and define all the factors and 

evidentiary standards used to design or 

apply the NQTL. The plan or issuer 

must also describe how the factors 

identified are used in the design and 

application of the NQTL, and evaluate 

whether any processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

NQTL to mental health or substance use 

disorder benefits are comparable to, and 

are applied no more stringently than, 

those with respect to medical/surgical 

benefits, both as written and in 

operation. Finally, plans and issuers 

must address the findings and 

conclusions as to the comparability of 

the processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the NQTLs 

within each classification, and the 

relative stringency of their application, 

both as written and in operation. 

Accordingly, these final rules will 

increase plan and issuer compliance 

with the requirements for imposing 

NQTLs under MHPAEA and help 

ensure that NQTLs applicable to mental 

health and substance use disorder 

benefits are no more restrictive than the 

predominant NQTLs applicable to 

substantially all medical/surgical 

benefits in the same classification. The 

Departments acknowledge that past 

parity implementation has lacked 

consistency and thus had varied results, 

particularly for laws limiting 

management of behavioral health 

benefits or NQTLs. A 2012 study on the 

implementation of Oregon’s 2007 

comprehensive parity law, which 

mandated benefits for substance use 

disorders and restricted the use of 

behavioral health management for fully 

insured commercial group plans, 

compared their expenditures for 

treatments to those of self-funded plans 

not covered by Oregon’s law. The study 

found that while plan expenditures for 

alcohol treatment services increased, 

other substance use treatments were not 

associated with a statistically significant 

increase in expenditures and that 

overall, the impact of parity on 

spending was not significantly different 

from zero.182 However, a broader study 

conducted in 2013 looked at treatment 

counts at specialty substance use 

disorder facilities between 2000 and 

2008 across the United States to assess 

the impact of State-level substance use 

disorder parity laws on State aggregate 

treatment rates. While the study was not 

able to control for the source of 

insurance and employment status of 

those receiving treatment, the study did 

find that the implementation of any 

State substance use disorder parity laws 

was associated with increased access to 

specialty substance use disorder 

treatments—by 9 percent in all specialty 

substance use disorder treatment 

facilities and 15 percent in facilities 

accepting private insurance.183

The Departments are of the view that, 

by finalizing these rules and requiring 

better documentation related to how 

plans and issuers design and apply 

NQTLs, the Departments and applicable 

State authorities will be better able to 

enforce existing parity requirements. In 

doing so, access to in-network, 

medically necessary treatments will 

increase for a significant segment of 

individuals whose health coverage will 

be affected by these final rules, resulting 

in better health outcomes and lower outof-pocket costs related to mental health 

and substance use disorder benefits for 

participants, beneficiaries, and 

enrollees. 

Plans and issuers will incur costs to 

comply with the requirements in these 

final rules. However, the Departments 

have determined that the benefits of 

these final rules justify the costs. In 

accordance with OMB Circular A–4, 

Table 1 depicts an accounting statement 

summarizing the Departments’ 

assessment of the benefits, costs, and 

transfers associated with these 

regulatory actions. The Departments are 

unable to quantify all benefits, costs, 

and transfers of these final rules, but 

have sought, where possible, to describe 

these non-quantified impacts. 

The effects in Table 1 reflect nonquantified impacts and estimated direct 

monetary costs resulting from the 

provisions of these final rules. 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77661 

184For purposes of this regulatory impact 

analysis, health insurance company refers to a 

single entity that offers health insurance coverage 

in one or multiple States, which might own or be 

affiliated with one or multiple entities that are 

separately required to be licensed to engage in the 

business of insurance in each such State. Health 

insurance issuer or issuer means an insurance 

company, insurance service, or insurance 

organization (including an HMO) that is required to 

be licensed to engage in the business of insurance 

in a State and that is subject to State law that 

regulates insurance. PHS Act section 2791(b)(2) and 

45 CFR 144.103. 

185The Departments note that the number of 

issuers may be underestimated, since some 

managed behavioral health organizations may not 

be included in the issuer count. 

TABLE 1—ACCOUNTING STATEMENT

Benefits: 

• Improved understanding of and compliance with MHPAEA by plans and issuers, resulting in better frameworks for determining whether 

plans and issuers are complying with MHPAEA with respect to NQTLs applicable to mental health and substance use disorder benefits 

and medical/surgical benefits. 

• Greater access and utilization of mental health and substance use disorder services by reducing barriers to coverage of mental health 

and substance use disorder treatment, which will result in better health outcomes for those with mental health conditions or substance 

use disorders. 

• Reduction in the negative impacts on families, friends, caregivers, and coworkers of those with untreated or poorly managed mental 

health conditions or substance use disorders based on their improved access to treatment. 

Costs: 

• Increased costs to plans and issuers to implement changes associated with the revision of plan provisions, which would result in increased costs from expanded coverage of mental health and substance use disorder services. 

• Costs to plans and issuers from collecting and evaluating outcomes data and documenting NQTL comparative analyses consistent with 

the requirements of these final rules of approximately $656.2 million in the first year and approximately $131.2 million in subsequent 

years or between 0.07 percent and 0.01 percent of total health insurance premiums in the group and individual markets. 

• Costs to plans and issuers for preparing and mailing the comparative analyses upon request to participants, beneficiaries, and enrollees 

of approximately $14.8 million annually. 

• Cost to plan and issuers for providing comparative analyses for audits is approximately $23,800. 

• First-year regulatory review costs to plans and issuers for familiarizing themselves with these final rules of approximately $10.8 million. 

• Cost to plan and issuers to maintain recordkeeping is approximately $12.2 million. 

• Potential increase in cost-sharing requirements and/or treatment limitations for medical/surgical benefits for participants, beneficiaries, 

and enrollees, if plans and issuers try to achieve parity by imposing new restrictions on medical/surgical benefits, rather than by reducing 

restrictions on access to mental health or substance use disorder benefits. 

• Potential costs to self-funded non-Federal governmental plans that opted out of MHPAEA to come into compliance with requirements 

under MHPAEA. 

• Cost savings to self-funded non-Federal governmental plans of approximately $11,783 annually in total from no longer sending opt-out 

notices regarding a plan’s MHPAEA opt-out election. 

• Cost savings for the Federal Government of approximately $5,200 annually from fewer opt-out notices being submitted by self-funded 

non-Federal governmental plans. 

Costs Estimate Year 

dollar 

Discount 

rate 

(percent) 

Period 

covered 

Annualized Monetized ($million/Year) ....................................................................... $217.35 

207.04 

2024 

2024 

7 

3 

2024–2033 

2024–2033 

Transfers: 

• Potential transfers from plans and issuers to participants, beneficiaries, and enrollees resulting in lower out-of-pocket spending on mental 

health and substance use disorder services. 

• Potential transfers from participants, beneficiaries, and enrollees to plans and issuers caused by higher premiums or contributions associated with increased utilization of mental health and substance use disorder services, provider network improvements, and increased provider reimbursement rates. 

• Potential transfers from primary care providers to mental health providers for the treatment of mental health conditions and substance 

use disorders as a result of an increased number of in-network mental health and substance use disorder providers and decisions by 

participants, beneficiaries, and enrollees to obtain treatment from those providers instead of a primary care provider. 

5. Affected Entities 

The following table summarizes the 

number of plans, issuers,184 TPAs, and 

multiple employer welfare arrangement 

(MEWAs) that would be affected by the 

final rules.185 These estimates are 

discussed in greater detail later in this 

regulatory impact analysis. 

TABLE 2—AFFECTED ENTITIES

Self-funded 

plan count 

Mixed insured 

plan count Total 

Issuers (health insurance company/State combinations) ........................................................................ ...................... .......................... 1,467 

TPAs ........................................................................................................................................................ ...................... .......................... 205 

Plan MEWAs that are not fully insured ................................................................................................... ...................... .......................... 132 

Non-plan MEWAs that are not fully insured ............................................................................................ ...................... .......................... 21 

Plans (total) 186 187 ................................................................................................................................... 46,080 4,501 50,581 

Under 100 participants ..................................................................................................................... 25,150 176 25,326 

100 to 199 participants ..................................................................................................................... 5,209 402 5,611 

200 to 499 participants ..................................................................................................................... 6,861 755 7,616 


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77662 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

186The Departments note that the final rules will 

affect approximately 106,000 fully insured plans 

with 50 to 100 participants. (Note: The Departments 

estimate that there are 140,998 ERISA-covered 

group health plans with 50 to 100 participants 

based on the Medical Expenditure Panel Survey 

Insurance Component (MEPS–IC) and the 2020 

County Business Patterns from the Census Bureau. 

The Departments also estimate that 75 percent of 

ERISA-covered group health plans with 50 to 100 

participants are fully insured based on assumptions 

referencing these same data. Thus, the Departments 

have calculated the number of fully insured plans 

with 50 to 100 participants in the following 

manner: 140,998 ERISA-covered group health plans 

with 50 to 100 participants × 75 percent = 105,749.) 

187The Departments also note that the final rules 

will affect approximately 1,719,000 fully insured, 

non-grandfathered plans with less than 50 

participants. (Note: The Departments estimate that 

there are 2,465,483 ERISA-covered group health 

plans with less than 50 participants based on data 

from the 2022 MEPS–IC and the 2020 County 

Business Patterns from the Census Bureau. The 

Departments also estimate that 83 percent of group 

health plans with less than 50 participants are fully 

insured based on data from the 2022 MEPS–IC. The 

2020 KFF Employer Health Benefits Survey 

reported that in 2020, 16 percent of firms offering 

health benefits offered at least one grandfathered 

health plan; therefore, the Departments assume the 

percent of firms offering at least one nongrandfathered health plan is 84 percent (100 

percent ¥ 16 percent). KFF, 2020 Employer Health 

Benefits Survey (Oct. 8, 2020), https://files.kff.org/ 

attachment/Report-Employer-Health-Benefits-2020- 

Annual-Survey.pdf. Thus, the Departments have 

calculated the number of fully insured, nongrandfathered plans with less than 50 participants 

in the following manner: 2,465,483 small ERISAcovered group health plans × 83 percent × 84 

percent = 1,718,935.) 

188The Departments’ estimate of the number of 

health insurance issuers is based on medical loss 

ratio (MLR) reports submitted by issuers for the 

2022 reporting year. CMS, Medical Loss Ratio Data 

and System Resources (2022), https://www.cms.gov/ 

CCIIO/Resources/Data-Resources/mlr. 

189Non-issuer TPAs based on data derived from 

the 2016 benefit year reinsurance program 

contributions. 

190The Departments’ estimate of the number of 

managed behavioral health organizations is based 

on industry trade association membership, 

including the National Behavioral Consortium 

(https://www.nbcgroup.org/member-directory/) and 

ABHW (https://abhw.org/about/). 

191EBSA, 2020 Form M–1 Bulletin, Table 1, 

https://www.dol.gov/sites/dolgov/files/ebsa/

researchers/statistics/health-and-welfare-bulletins/ 

m-1/2020.pdf. 

192 85 FR 72158 (Jan 11, 2021). 

TABLE 2—AFFECTED ENTITIES—Continued 

Self-funded 

plan count 

Mixed insured 

plan count Total 

500 to 999 participants ..................................................................................................................... 3,812 671 4,483 

1,000 to 2,499 participants ............................................................................................................... 2,880 948 3,828 

2,500 to 4,999 participants ............................................................................................................... 1,119 561 1,680 

5,000 and above participants ........................................................................................................... 1,049 988 2,037 

Plans with less than 500 participants that will seek assistance with the comparative analyses from 

TPAs, MEWAs, or service providers ................................................................................................... 37,220 1,333 38,553 

Plans with more than 500 participants that will conduct the comparative analysis themselves ............ 709 253 962 

Plans with more than 500 participants that will receive generic comparative analyses from TPAs or 

service providers and will then customize it ........................................................................................ 4,076 1,458 5,534 

Non-Federal governmental plans with less than 500 participants that will seek assistance with the 

comparative analyses from TPAs or service providers ....................................................................... 26,584 .......................... 26,584 

Non-Federal governmental plans with more than 500 participants that will conduct the comparative 

analysis themselves ............................................................................................................................. 505 .......................... 505 

Non-Federal governmental plans with more than 500 participants that will initially receive generic 

comparative analyses from TPAs or service providers and will then customize it ............................. 2,906 .......................... 2,906 

5.1. Issuers, TPAs, and MEWAs 

Under the Departments’ final rules, 

issuers are responsible for providing 

data and comparatives analyses for 

individual market plans. For small and 

large group market fully insured, 

employer-sponsored plans, including 

non-Federal governmental plans, both 

employer-sponsored health plans and 

health insurance issuers are responsible 

for providing data and comparative 

analyses, though for those plans, 

underlying data and analyses will likely 

be provided by issuers that design and 

market the plans. Self-funded group 

health plans, while responsible for 

complying with these rules, will likely 

seek assistance from their TPAs, MEWA 

administrators, and other service 

providers for collecting and analyzing 

the data, and generating the comparative 

analyses. 

The Departments estimate that the 

final rules will affect 479 health 

insurance companies nationwide that 

provide coverage, including mental 

health and substance use disorder 

benefits, in the group and individual 

health insurance markets, with 1,467 

issuers (health insurance company/State 

combinations).188 In addition, there are 

an estimated 205 TPAs that provide 

services to group health plans, 

particularly for self-funded plans where 

TPAs often establish provider networks 

and adjudicate claims, which would be 

impacted by these final rules.189 The 

Departments estimate that the final rules 

will affect at least 40 managed 

behavioral health organizations 

providing mental health and substance 

use disorder benefits to group health 

plans.190 Additionally, based on the 

Form M–1 filings, the Departments 

estimate that there are 687 plan 

MEWAs, of which 132 are not fully 

insured, and 50 non-plan MEWAs, of 

which 21 are not fully insured.191 These 

MEWAs, similar to issuers, are likely to 

provide support to employers or plans. 

Issuers, TPAs, and MEWAs provide 

key support for plan compliance with 

laws and regulations for group health 

plans, including MHPAEA. The 

Departments’ understanding, based on 

discussions with the regulated 

community and numerous direct 

investigations of plans, including the 

review of comparative analyses, is that 

issuers of fully insured coverage provide 

a menu of benefit combinations from 

which interested parties select their 

coverage designs. These coverage 

designs may include different features, 

such as varying deductibles, 

copayments, and coverage for specific 

items and services, allowing interested 

parties to choose the plan that best suits 

their health care needs. While issuers of 

fully insured health plans are 

responsible for overseeing the 

compliance framework and ensuring 

that plans comply with legal and 

regulatory requirements, TPAs play a 

crucial role in facilitating compliance 

for self-funded plans by providing 

administrative support, including 

claims adjudication, member 

enrollment, and customer service. 

TPAs and insurance companies 

providing administrative services only 

(ASO) to self-funded plans 

overwhelmingly design the plans, 

administer the networks, manage 

claims, provide plan services, maintain 

and hold the data relevant for the 

comparative analyses, and help ensure 

MHPAEA compliance.192 Self-funded 

plans rarely build independent provider 

networks and instead rely on those built 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77663 

193 KFF, 2019 Employer Health Benefits Survey, 

Table 14.15 (Sept. 25, 2019), https://www.kff.org/ 

report-section/ehbs-2019-section-14-employerpractices-and-health-plan-networks/. 

194 DOL, Selected Medical Benefits: A Report from 

the Department of Labor to the Department of 

Health and Human Services (Apr. 15, 2011), 

https://www.bls.gov/ebs/additional-resources/ 

selected-medical-benefits-a-report-from-dol-tohhs.pdf. 

195The Departments estimate that there are 

2,465,483 ERISA-covered group health plans with 

less than 50 participants and that 83 percent of 

group health plans with less than 50 participants 

are fully insured based on data from the 2022 

MEPS–IC and the 2020 County Business Patterns 

from the Census Bureau. The 2020 KFF Employer 

Health Benefits Survey reported that in 2020, 16 

percent of firms offering health benefits offered at 

least one grandfathered health plan. KFF, 2020 

Employer Health Benefits Survey (Oct. 8, 2020), 

https://files.kff.org/attachment/Report-EmployerHealth-Benefits-2020-Annual-Survey.pdf. Thus, the 

Departments have calculated the number of fully 

insured, non-grandfathered plans with less than 50 

participants in the following manner: 2,465,483 

small ERISA-covered group health plans × 83 

percent × (100 percent ¥ 16 percent) = 1,718,935. 

Based on the 2022 MEPS–IC and the 2020 County 

Business Patterns from the Census Bureau, the 

Departments estimate 60 percent of ERISA-covered 

group health plans with 50 or more participants are 

self-funded. Thus, the Departments calculate the 

number of self-funded group health plans in the 

following manner: 410,581 ERISA-covered group 

health plans with 50 or more participants × 60 

percent = 246,349. 

196Based on data from the 2022 Census of 

Governments (https://www.census.gov/data/tables/ 

2022/econ/gus/2022-governments.html), there are 

90,887 State and local entities. The Departments 

assume there is one plan per entity on average. 

Therefore, the Departments estimate that there are 

90,887 non-Federal governmental plans. 

197MHPAEA applies to non-Federal 

governmental plans. Using data from the 2022 

MEPS–IC and the 2020 County Business Patterns 

from the Census Bureau, the Departments estimate 

that 14 percent of ERISA-covered group health 

plans have 50 or more participants. The 

Departments use the percent of ERISA-covered 

group plans with 50 or more participants as a proxy 

for the percent of non-Federal governmental plans 

with 50 or more participants. Therefore, the 

Departments estimate that there are 12,724 public, 

non-Federal governmental plans with 50 or more 

participants that offer mental health or substance 

use disorder benefits (90,887 non-Federal 

governmental plans × 14 percent of plans with 50 

or more employees = 12,724). 

by TPAs (including those that are also 

health insurance companies). According 

to the 2019 KFF Employer Health 

Benefits Survey, only 8 percent of large, 

self-funded plans with 200 or more 

employees reported that they directly 

contracted with hospitals and health 

systems, independent of the plan’s TPA, 

to provide health care services separate 

from the provider networks included in 

the plan network.193

While the requirement to comply with 

MHPAEA is directly applicable to group 

health plans and health insurance 

issuers, the Departments anticipate that 

issuers and TPAs are best situated to 

conduct comparative analyses as 

required under the CAA, 2021 and these 

final rules, and to provide the analyses 

in an efficient and cost-effective 

manner, helping to reduce the 

compliance burden. Self-funded plans 

may, however, incur some additional 

costs to complete the comparative 

analysis initially prepared by the issuer 

or TPA to address unique plan issues 

and include all the information 

necessary to perform comparative 

analyses. 

One commenter stated they are not 

aware of any TPA that has assumed 

compliance obligations wholesale, 

though they acknowledged that TPAs 

had cooperated and provided data in 

response to a government audit. 

Another commenter reported that TPAs 

working on behalf of group health plan 

sponsors struggle to obtain needed 

information to perform and document 

comparative analyses, such as when 

claims expenditure data collected by 

TPAs is not compatible for testing 

purposes and, moreover, is not reported 

at the plan sponsor level. It should be 

noted that these reported challenges are 

not unique to TPAs, but are the same 

issues facing issuers and self-funded 

plans. However, TPAs are more likely 

than plan sponsors to have expertise to 

navigate the challenges. 

Other commenters supported the 

Departments’ assumptions that 

employer-sponsored plans rely on their 

services providers and TPAs to conduct 

their comparative analyses. One 

commenter noted that only the 

insurance carriers, TPAs, and service 

providers that play a role in designing 

plans, administering networks, 

managing claims, providing plan 

services, and maintaining and holding 

the data relevant for the comparative 

analyses have the expertise to comply 

with and fulfill all the requirements 

outlined in the proposed rules. Another 

commenter noted that self-funded plan 

sponsors rely on TPAs and/or the 

owners of provider networks to develop 

plan designs and develop and impose 

NQTLs, arguing that if the TPA or 

owner of the provider networks do not 

share claims data, then the TPA or 

owner of the provider networks should 

be required to conduct analyses for the 

plans. 

While the Departments acknowledge 

these concerns, based on their own 

observations when reviewing 

comparative analyses, the Departments 

expect that issuers, TPAs, and service 

providers will continue to provide 

assistance to evaluate NQTLs and 

perform and document comparative 

analyses, including data required under 

these final rules, for their plan clients. 

The Departments emphasize that the 

requirement to perform and document 

comparative analyses of the design and 

application of NQTLs has been effective 

under the CAA, 2021 for more than 3 

years (since February 10, 2021) and is 

an independent statutory obligation that 

is not dependent upon a request by the 

Secretaries or an applicable State 

authority. Issuers and plans, in 

conjunction with their TPAs for selffunded group health plans, have had 

ample time to develop the internal 

structures required for analyzing NQTLs 

to ensure that their plans and coverage 

comply with MHPAEA. Finally, while 

plans could be charged for the services 

of issuers, TPAs, and other service 

providers, this arrangement provides for 

economies of scale in compliance, as 

issuers evaluate NQTLs, produce or 

assist in producing the comparative 

analyses for their products and plan 

designs, and, in combination with TPAs 

and other service providers, provide 

support for other requirements. 

5.2. Group Health Plans 

Group health plans sponsored by 

employers with 50 or more employees 

that offer mental health and substance 

use disorder benefits are generally 

required to comply with MHPAEA. 

Although MHPAEA includes a small 

employer exemption, group health plans 

sponsored by employers with less than 

50 employees who purchase nongrandfathered small group coverage are 

required to comply with MHPAEA 

under the EHB requirements of the 

ACA. In this analysis, plan size is used 

as a proxy for employer size to 

determine if a plan is affected. Evidence 

suggests that most large group plans 

offer mental health and substance use 

disorder benefits and nearly all 

participants are covered.194

The Departments estimate that 

approximately 1,719,000 fully insured, 

non-grandfathered ERISA-covered group 

health plans with less than 50 

participants and approximately 411,000 

ERISA-covered group health plans with 

50 or more participants, of which 

approximately 246,000 are self-funded 

group health plans, will be affected by 

these final rules.195 In addition, the 

Departments estimate that these final 

rules will affect approximately 90,900 

non-Federal governmental plans,196 of 

which approximately 12,700 are plans 

with 50 or more participants.197 The 

Departments requested comments on 

these estimates in the proposal, but did 

not receive any. 

The estimated compliance costs 

associated with these final rules are 


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77664 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

198A mixed-insured plan is funded through a 

mixture of insurance and self-insurance. EBSA, 

Self-Insured Health Benefit Plans 2024: Based on 

Filings through 2021 (Sept. 30, 2023), Table 2, 

https://www.dol.gov/sites/dolgov/files/EBSA/ 

researchers/statistics/retirement-bulletins/annualreport-on-self-insured-group-health-plans-2024- 

appendix-b.pdf. 

199Estimates based on the 2021 Form 5500 data. 

200Based on the 2022 Census of Governments, 

there are 90,887 non-Federal governmental plans. 

Based on the 2022 MEPS–IC, the Departments 

estimate that 36.2 percent of non-Federal 

governmental plans are self-funded. Thus, 90,887 

plans × 36.2 percent = 32,901 self-funded nonFederal governmental plans. Based on the 2021 

Form 5500 data, the Departments estimate that 80.8 

percent of self-funded health plans with less than 

500 participants have filed the Form 5500. The 

Departments use the percent of self-funded health 

plans with less than 500 participants that have filed 

a Form 5500 as a proxy for the percent of selffunded non-Federal governmental plans with less 

than 500 participants. Thus, 32,901 self-funded 

non-Federal governmental plans × 80.8 percent = 

26,584 self-funded non-Federal governmental plans 

with less than 500 participants. 

201Based on the 2021 Form 5500 data, there are 

12,028 self-funded plans with 500 or more 

participants. According to the 2019 KFF Employer 

Health Benefits Survey, only 8 percent of large, selffunded plans with 200 or more employees reported 

that they directly contracted with hospitals and 

health systems, independent of the plan’s TPA, in 

order to provide health care and services separate 

from the provider networks included in the plan 

network. KFF, 2019 Employer Health Benefits 

Survey (Sept. 25, 2019), Table 14.15, https://

www.kff.org/report-section/ehbs-2019-section-14- 

employer-practices-and-health-plan-networks/. 

Thus, 12,028 self-funded plans with 500 or more 

participants × 8 percent = 962 self-funded plans 

with more than 500 participants. 

202Based on the 2022 Census of Governments, 

there are 90,887 non-Federal governmental plans. 

Based on the 2022 MEPS–IC, the Departments 

estimate that 36.2 percent of non-Federal 

governmental plans are self-funded. Thus, 90,8888 

plans × 36.2 percent = 32,901 self-funded nonFederal governmental plans. Based on the 2021 

Form 5500 data, the Departments estimate that 19.2 

percent of health plans with more than 500 

participants have filed the Form 5500. The 

Departments use the percent of health plans with 

more than 500 participants that have filed a Form 

5500 as a proxy for the percent of non-Federal 

governmental plans with more than 500 

participants. According to the 2019 KFF Employer 

Health Benefits Survey, only 8 percent of large, selffunded plans with 200 or more employees reported 

that they directly contracted with hospitals and 

health systems, independent of the plan’s TPA, in 

order to provide health care and services separate 

from the provider networks included in the plan 

network. KFF, 2019 Employer Health Benefits 

Survey (Sept. 25, 2019), Table 14.15, https://

www.kff.org/report-section/ehbs-2019-section-14- 

employer-practices-and-health-plan-networks/. 

Thus, 32,901 non-Federal governmental plans × 

19.2 percent × 8 percent = 505 non-Federal 

governmental plans with more than 500 

participants. 

203Based on the 2021 Form 5500 data, there are 

a total of 50,581 self-funded plans. Thus, (50,581 

self-funded plans ¥ 38,533 self-funded plans with 

less than 500 participants ¥ 962 self-funded plans 

with more than 500 participants) × 50 percent = 

5,535 self-funded plans with more than 500 

participants. 

204Based on the 2022 Census of Governments, 

there are 90,887 non-Federal governmental plans. 

Based on the 2022 MEPS–IC, the Departments 

estimate that 36.7 percent of non-Federal 

governmental plans are self-funded. Thus, 90,888 

plans × 36.2 percent = 32,901 self-funded nonFederal governmental plans. Thus, (32,901 nonFederal governmental plans ¥ 26,584 non-Federal 

governmental plans with less than 500 participants 

¥ 505 self-funded plans with more than 500 

participants) × 50 percent = 2,906 non-Federal 

governmental plans with more than 500 

participants. 

205CMS, HIPAA Opt-Out Elections for SelfFunded Non-Federal Governmental Plans, as of 

January 6, 2023. 

206According to data from the 2022 MEPS–IC 

(https://meps.ahrq.gov/mepsweb/), there are 

19,231,948 State and local government employees, 

and 67.1 percent of these employees (12,904,637) 

are enrolled in health coverage through their jobs. 

Of these employees, 66.5 percent (8,581,584 

employees) are participants in self-funded plans. 

Based on data from the 2022 Census of 

Governments (https://www.census.gov/data/tables/ 

2022/econ/gus/2022-governments.html), there are 

90,887 State and local government entities, and 

according to the 2022 MEPS–IC, 36.2 percent, or 

32,901, of State and local government entities selffund at least one plan. Therefore, the average 

number of participants per self-funded non-Federal 

governmental plan is (8,581,584 ÷ 32,901) = 260.8. 

Since HHS also estimates that there is one 

beneficiary for each plan participant on average, the 

average number of participants and beneficiaries 

per self-funded non-Federal governmental plan is 

(260.8 × 2) = 521.7. 

207This estimate is calculated as follows: 230 selffunded non-Federal governmental plans that have 

elected to opt out of the requirements under 

MHPAEA × approximately 521.7 participants and 

beneficiaries for each self-funded non-Federal 

governmental plan on average = 119,991. 

impacted by whether a plan is fully 

insured or self-funded. The Departments 

anticipate that fully insured plans will 

receive compliance support in the form 

of comparative analyses and data 

analyses prepared by the issuer. For 

these plans, the burden is estimated as 

a cost for the issuer to prepare the 

analyses and analyze the data. Selffunded plans may rely on issuers or 

TPAs acting as service providers, 

receive some support from their service 

providers that they supplement 

themselves, or produce the required 

information themselves. 

Most employer-sponsored health 

plans are exempt from filing a Form 

5500 due to size and the absence of plan 

assets, the majority of which are fully 

insured. Large health plans are required 

to file a Form 5500, regardless of 

funding arrangement. For statistical year 

2021, 81,800 health plans filed a Form 

5500. Of these plans, 50,600 were selffunded or mixed-insured,198 of which 

38,600 had less than 500 participants.199

Additionally, the Departments estimate 

that there are 26,600 self-funded nonFederal governmental plans with less 

than 500 participants.200 The 

Departments assume that self-funded 

plans with less than 500 participants 

will receive assistance with the 

comparative analyses and data 

requirements from TPAs or service 

providers involved with the plans. 

The Departments assume that some of 

the largest plans will incur the full cost 

of preparing the comparative analysis 

and conducting the required data 

analyses. Commenters suggested that 

some large, self-funded plans would 

conduct the comparative analyses 

themselves. To account for these plans, 

the Departments estimate that 8 percent 

of self-funded plans with 500 or more 

participants, or 962 ERISA covered 

plans 201 and 505 non-Federal 

governmental plans,202 will prepare the 

comparative analysis and conduct the 

required data analyses themselves. The 

Departments estimate that 50 percent of 

the remaining self-funded plans with 

500 or more participants, or 5,535 selffunded plans,203 and 2,900 self-funded 

non-Federal governmental plans with 

500 or more participants will receive a 

generic comparative analysis from the 

TPA,204 which they will subsequently 

customize to suit their specific needs. 

These plans will incur costs, but not at 

the same level other entities preparing 

the comparative analysis and data for 

themselves. 

Finally, HHS estimates that 230 selffunded non-Federal governmental plans 

will be affected by the implementation 

of the CAA, 2023 provision that sunsets 

the MHPAEA opt-out election.205 HHS 

is aware of at least 14 plans with 

collective bargaining agreements whose 

sponsors’ MHPAEA opt-out elections 

could be in effect beyond 2024. The 

MHPAEA opt-out election of these plans 

with collective bargaining agreements 

will remain in effect until the last of 

these plans’ respective collective 

bargaining agreements expires, all of 

which are anticipated to expire by 2028. 

HHS does not have precise information 

about the number of participants and 

beneficiaries of the plans that have 

elected to opt out of requirements under 

MHPAEA, as those plans are not 

required to report this information to 

HHS. However, HHS estimates that 

there are approximately 261 

participants, on average, in each selffunded non-Federal governmental 

plan.206 HHS also estimates that there is 

one beneficiary for each plan participant 

on average. Therefore, approximately 

120,000 participants and beneficiaries 

will be affected by this final 

provision.207

HHS solicited comments on the 

estimated number of self-funded nonFederal governmental plans and the 

estimated number of plan participants 

and beneficiaries that would be affected 

by the implementation of the CAA, 2023 

provision that sunsets the MHPAEA 

opt-out election. Although HHS did not 

receive comments on the estimated 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77665 

208The Departments have not identified what 

share of plans with 50 or more participants offer 

mental health or substance use disorder benefits 

and so has assumed that all of these plans offer 

them. The Departments estimate that there are 

56,983,874 participants and 50,407,439 

beneficiaries in ERISA-covered group health plans 

with 50 or more participants. Estimates are based 

on the Departments’ tabulations of the March 2022 

Current Population Survey (CPS) Auxiliary Data 

(https://www.dol.gov/agencies/ebsa/researchers/ 

data/auxiliary-data). 

209The Departments have not identified what 

share of plans with 50 or more participants offer 

mental health or substance use disorder benefits 

and so has assumed that all of these plans offer 

them. The Departments estimate that there are 

17,482,879 participants in non-Federal 

governmental plans with 50 or more participants. 

Estimates are based on the Departments’ tabulations 

of the March 2022 CPS Auxiliary Data (https://

www.dol.gov/agencies/ebsa/researchers/data/ 

auxiliary-data). 

210The Departments estimate that there are 

12,212,484 participants and 10,272,985 

beneficiaries in fully insured, private-sector health 

plans with less than 50 participants based on the 

Departments’ tabulations of the March 2022 CPS 

Auxiliary Data (https://www.dol.gov/agencies/ebsa/ 

researchers/data/auxiliary-data). Assuming, based 

on KFF assumptions that 84 percent of participant 

and beneficiaries are in non-grandfathered plans 

(KFF, 2020 Employer Health Benefits Survey (Oct. 

8, 2020), https://files.kff.org/attachment/ReportEmployer-Health-Benefits-2020-AnnualSurvey.pdf), this will translate into an estimated 

10,258,487 participants and 8,629,307 beneficiaries 

in fully insured, private-sector, non-grandfathered 

plans with less than 50 participants. 

211Based on MLR reports submitted by issuers for 

the 2022 reporting year, the number of 

policyholders in individual health insurance 

coverage offered in the individual market is 

approximately 12 million and the number of 

enrollees was approximately 16,000,000. CMS, 

Medical Loss Ratio Data and System Resources 

(2022), https://www.cms.gov/CCIIO/Resources/ 

Data-Resources/mlr. 

212Robin Gelburd, The Mental Health Parity Act: 

10 Years Later, American Journal of Managed Care 

(Nov. 22, 2018), https://www.ajmc.com/view/themental-health-parity-act-10-years-later. 

213Paul Fronstin & Christopher Roebuck, How Do 

High-Deductible Health Plans Affect Use of Health 

Care Services and Spending Among Enrollees with 

Mental Health Disorders?, EBRI Issue No. 555 

Figure 3 (Mar. 10, 2022), https://www.ebri.org/docs/ 

default-source/ebri-issue-brief/ebri_ib_555_

mentalhealth-10mar22.pdf?sfvrsn=aec3b2f_2. 

214AHIP, How Employer-Provided Coverage 

Improves Access to Mental Health Support (May 

2022), https://www.ahip.org/documents/202205- 

CaW_MentalHealth-v03.pdf. 

215SAMHSA, Key Substance Use and Mental 

Health Indicators in the United States: Results from 

the 2022 National Survey on Drug Use and Health, 

pp. 33, 51–52 (Nov. 2023), https://

www.samhsa.gov/data/sites/default/files/reports/ 

rpt42731/2022-nsduh-nnr.pdf. 

216Nirmita Panchal, Heather Saunders, Robin 

Rudowitz, & Cynthia Cox, The Implications of 

COVID–19 for Mental Health and Substance Use, 

KFF Issue Brief (Mar. 20, 2023), https://

www.kff.org/coronavirus-covid-19/issue-brief/theimplications-of-covid-19-for-mental-health-andsubstance-use/. 

217 Kristen Figas, Theodoros V. Giannouchos, & 

Elizabeth Crouch, Child and Adolescent Anxiety 

and Depression Prior to and During the COVID–19 

Pandemic in the United States, 24 Child Psychiatry 

& Human Development pp. 1–11 (2023). 

218 Yan Xie, Evan Xu, & Ziyad Al-Aly, Risks of 

Mental Health Outcomes in People with Covid-19: 

Cohort Study, 376 The BMJ (2022), https://

www.bmj.com/content/376/bmj-2021-068993. 

number of self-funded non-Federal 

governmental plans or the estimated 

number of plan participants and 

beneficiaries that would be affected by 

the implementation of this provision, 

many commenters indicated that 

hundreds of thousands of public 

employees and their family members 

have been denied the critical MHPAEA 

protections due to the election option 

for self-funded non-Federal 

governmental plans to opt out of 

requirements under MHPAEA. Another 

commenter indicated that the ability to 

opt out of requirements under MHPAEA 

has compromised the health and wellbeing of State and local government 

employees, such as teachers, 

firefighters, and civil servants across the 

country. HHS agrees that a significant 

number of individuals will be impacted 

by the CAA, 2023 provision that sunsets 

the MHPAEA opt-out election and that 

these regulatory amendments will 

ultimately increase access to mental 

health and substance use disorder 

services by requiring self-funded nonFederal governmental plans that had 

previously opted out to come into 

compliance with the requirements 

under MHPAEA. 

5.3. Participants, Beneficiaries, and 

Enrollees Receiving Mental Health and 

Substance Use Disorder Treatment 

There are approximately 56,984,000 

participants and 50,407,000 

beneficiaries in ERISA-covered group 

health plans with 50 or more 

participants,208 approximately 

17,483,000 participants and 

approximately 14,854,000 beneficiaries 

in non-Federal governmental plans with 

50 or more participants,209

approximately 10,258,000 participants 

and 8,629,000 beneficiaries in ERISA 

covered, non-grandfathered, fully 

insured health plans with less than 50 

participants,210 and approximately 

12,000,000 individual health insurance 

coverage policyholders (with 

approximately 16,000,000 total 

enrollees).211

Since the enactment of MHPAEA, 

participants have increasingly utilized 

behavioral health services through their 

health coverage. Between 2007 and 

2017, private insurance claim lines for 

behavioral health diagnoses increased 

by 320 percent.212 Claims data show 

that between 2013 and 2019, the 

percentage of the employment-based 

coverage population under the age of 65 

diagnosed with major depressive 

disorder increased from 4.1 percent to 

5.3 percent, and the percentage of the 

population diagnosed with anxiety 

increased from 4.8 percent to 8.1 

percent.213 In 2020, 41 million 

Americans who were enrolled in 

employment-based coverage, including 

6 million children, received mental 

health support, which constituted 

nearly 25 percent of employment-based 

health plan participants and 

beneficiaries.214 A 2022 survey by 

SAMHSA indicated that among adults 

aged 18 or older, 23.1 percent (or 59.3 

million people) had any mental illness 

and 6.0 percent (or 15.4 million people) 

had serious mental illness in the past 

year. The same survey also indicated 

that among individuals aged 12 or older, 

17.3 percent (or 48.7 million people) 

had a substance use disorder in the past 

year, and of those only 14.9 percent (7.3 

million people) received treatment for 

substance use disorder in the past 

year.215

The COVID–19 public health 

emergency (PHE) exacerbated the need 

for mental health and substance use 

disorder treatments. During the 

pandemic, many adults consistently 

reported anxiety and depressive 

disorders symptoms, with 4 in 10 adults 

reporting symptoms in February 2021. 

Two years later in 2023, even as the 

pandemic receded from its peak, 

approximately 3 in 10 adults were still 

reporting symptoms of anxiety and 

depression.216 The pandemic likewise 

negatively impacted the mental health 

of children and adolescents, worsening 

reported rates of anxiety or depression 

which, in the 5 years preceding the 

pandemic, had already increased by 29 

percent and 27 percent, respectively.217

The pandemic may have long-term 

effects on mental health and substance 

use disorders, suggesting that the 

number of individuals affected by 

expanding access through their health 

plans will only continue to grow. A 

2022 study examined the chronic effects 

of the pandemic on the mental health of 

Veterans and found that COVID–19 

survivors were associated with a higher 

risk of developing mental health 

disorders, including anxiety, stress, 

depression, substance use, and 

neurocognitive decline, compared to 

individuals who did not have COVID– 

19.218 Another 2022 study examined the 

mental health outcomes of COVID–19 

survivors during the 12 months 

following their infection and found that 

COVID–19 survivors reported a high 

prevalence of depression, anxiety, and 

post-traumatic stress disorder at both 

the 6- and 12-months follow-up, 

indicating that the pandemic has longterm adverse mental health impacts on 


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77666 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

219Mario G. Mazza, Mariagrazia Palladini, 

Rebecca De Lorenzo, Beatrice Bravi, Sara Poletti, 

Roberto Furlan, Fabio Ciceri, Patrizia RovereQuerini, & Francesco Benedetti, One-Year Mental 

Health Outcomes in a Cohort of COVID–19 

Survivors, 145 Journal of Psychiatric Research pp. 

118–124 (2022). 

220Sean Warwicker, Denise Sant, Adrian Richard, 

Jake Cutajar, Annalise Bellizzi, Gertrude Micallef, 

Daniel Refalo, Liberato Camilleri, & Anton Grech, 

A Retrospective Longitudinal Analysis of Mental 

Health Admissions: Measuring the Fallout of the 

Pandemic, 20(2) International Journal of 

Environmental Research and Public Health p. 1194 

(2023). 

221The ‘‘MHPAEA program’’ refers to the 

MHPAEA statute, as amended, implementing 

regulations, and subsequent guidance, as discussed 

in section IV.3. 

222 Katherine M. Harris, Christopher Carpenter, & 

Yuhua Bao, The Effects of State Parity Laws on the 

Use of Mental Health Care, 44(6) Medical Care pp. 

499–505 (2006). 

223Susan H. Busch & Colleen L. Barry, New 

Evidence on the Effects of State Mental Health 

Mandates, INQUIRY: The Journal of Health Care 

Organization, 45(3) Provision, and Financing pp. 

308–322 (2008). 

224The study defined ‘‘full parity’’ as ‘‘requiring 

SUD [substance use disorder] coverage to be offered 

and offered on par with the comparable medical/ 

surgical coverage in all aspects of cost sharing and 

treatment limitations.’’ 

225The study defined ‘‘parity-if-offered’’ as ‘‘not 

requiring SUD coverage to be offered, but if offered, 

it should be on par with the comparable medical/ 

surgical coverage in all aspects of cost sharing and 

treatment limitations.’’ 

226The study defined ‘‘partial parity’’ as 

‘‘requiring SUD coverage to be offered, allows for 

discrepancies between SUD coverage and 

comparable medical/surgical coverage in some 

aspects of cost sharing and treatment limitations.’’ 

227Hefei Wen, Janet R. Cummings, Jason M. 

Hockenberry, Laura M. Gaydos, & Benjamin G. 

Druss, State Parity Laws and Access to Treatment 

for Substance Use Disorder in the United States: 

Implications for Federal Parity Legislation, 70(12) 

JAMA Psychiatry pp. 1355–1362 (2013). 

228Matthew Lang, The Impact of Mental Health 

Insurance Laws on State Suicide Rates, 22(1) Health 

Economics pp. 73–88 (2013). 

COVID–19 survivors.219 Finally, a 2023 

study found that the pandemic resulted 

in a long-term increase in the number of 

psychiatric inpatient admissions, 

suggesting that there is a post-pandemic 

need to prioritize psychiatric care.220

6. Studies Examining the Impact of 

MHPAEA and State Parity Laws 

6.1. Research Examining the Impact of 

State Parity Laws 

6.1.1. Research Finding State Parity 

Laws Increase the Utilization of Mental 

Health and Substance Use Disorder Care 

Research has found mixed evidence 

on the impact of State parity laws prior 

to the implementation of MHPAEA. 

While the specifics of the State-level 

programs might be different from 

MHPAEA, this research can nonetheless 

provide important context and 

suggestive evidence for how 

modifications to parity policies such as 

the MHPAEA program 221 might impact 

healthcare demand and quality. While 

some studies did not identify a 

significant change in costs or usage of 

behavioral health treatments following 

the passage of State parity laws, others 

found that State parity laws increased 

the utilization of mental health care and 

substance use disorder care among 

populations at risk. 

For example, a 2006 study evaluated 

changes in mental health care 

utilization before and after States 

implemented parity laws, comparing 

them with States that did not enact such 

laws in the same year controlling for 

State and year fixed effects. Using data 

from the 2001, 2002, and 2003 NSDUH, 

the study categorized individuals with 

individual or employer-sponsored 

health insurance by their level of mental 

and emotional distress during their most 

challenging month in the past year and 

found that State parity laws increased 

the likelihood of using any mental 

health care in the past year by up to 1.2 

percentage points for individuals with 

lower distress levels and up to 1.8 

percentage points for those with 

moderate distress levels. However, it is 

important to note that the study did not 

find a statistically significant effect on 

the mental health care utilization for 

individuals with severe distress levels. 

The authors noted that this group had 

already been more likely to use mental 

health care even before the State parity 

laws were implemented, suggesting they 

may have sought such care regardless of 

these laws.222

Similarly, a 2008 study examined 

whether State parity laws affect mental 

health care utilization differently among 

low-income individuals and those with 

poor mental health conditions. To 

examine these effects, the study used 

pooled cross-sectional data from the 

National Survey of America’s Families 

conducted in 1997, 1999, and 2001 and 

found that employees of small firms 

were more likely to use mental health 

and substance use disorder care after the 

implementation of State parity laws. 

While the study found no effect of 

parity for low-income adults for all 

employers, when limiting the sample to 

small employers, the study found that 

parity was associated with a 5- 

percentage-point increase in the 

probability of low-income individuals 

using mental health services. The study 

also found a large increase among those 

with poor mental health conditions 

employed by small employers, although 

this finding is only significant at a 10- 

percent significance level. The study 

did not find an effect for individuals 

with poor mental health for medium or 

large employers. The authors attributed 

these inconclusive results to the small 

sample size; therefore, the findings in 

this study should be interpreted with 

caution.223

Additionally, a 2013 study examined 

the effect of State parity laws on 

substance use disorder treatment using 

national survey data from 2000 to 2008 

using State and year fixed effects to 

compare non-parity States to parity 

States prior to the implementation of 

MHPAEA. The authors reported that the 

baseline substance use disorder 

treatment rate before State parity laws 

were enacted was 1.40 percentage 

points in all specialty substance use 

disorder treatment facilities and 1.10 

percentage points in facilities accepting 

private insurance. Relative to these 

baseline rates, this study found that the 

implementation of any parity law 

increased the treatment rate by 9 

percent in all specialty substance use 

disorder treatment facilities and by 15 

percent in all treatment facilities 

accepting private insurance. When 

controlling for the comprehensiveness 

of the State parity law, the study found 

that full parity 224 and parity-ifoffered 225 increased the substance use 

disorder treatment rate in all facilities 

by 13 percent and 8 percent, and by 21 

percent and 10 percent in those 

accepting private insurance, 

respectively; States with partial 

parity 226 did not have a significant 

effect on the substance use disorder 

treatment rates. The study conducted 

sensitivity analyses for facilities not 

accepting private insurance and found 

no difference in the treatment rates 

attributable to parity, suggesting that the 

effect of parity on the treatment rate is 

primarily driven by the increased 

treatment rate among the target 

population.227

6.1.2. Research Finding State Parity 

Laws Have Other Positive Effects 

Other studies have found that State 

parity laws have positive effects that 

extend beyond the use of mental health 

care. For example, a 2013 study 

comparing suicide rates in States with 

and without parity laws during two 

distinct periods: 1990 to 1997 and 1998 

to 2004, the period when the majority of 

States (22 out of 29) had implemented 

parity laws. The study found that State 

parity laws were associated with a 5- 

percent decrease in suicide rates, even 

after subjecting the analysis to several 

robustness checks.228

Similarly, a 2022 study examined 

how State parity laws affected suicide 

rates and educational outcomes among 

college-level students. Utilizing survey 


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229 Keisha T. Solomon & Kabir Dasgupta, State 

Mental Health Insurance Parity Laws and College 

Educational Outcomes, 86 Journal of Health 

Economics (2022). 

230The author defines ‘‘moderately distressed 

individuals’’ based on their reported levels of 

distress in the National Health Interview Survey. 

The authors categorized ‘‘distress’’ as follows: 

scores below 1 indicate no distress, 1 to 5 indicate 

low distress, 6 to 11 indicate moderate distress, and 

12 or above indicate severe distress. 

231Martin Andersen, Heterogeneity and the Effect 

of Mental Health Parity Mandates on the Labor 

Market, 43 Journal of Health Economics (2015). 

232Roland Sturm, State Parity Legislation and 

Changes in Health Insurance and Perceived Access 

to Care Among Individuals with Mental Illness: 

1996–1998, 3(4) The Journal of Mental Health 

Policy and Economics pp. 209–213 (2000). 

233Lucy A. Bilaver & Neil Jordan, Impact of State 

Mental Health Parity Laws on Access to Autism 

Services, 64(10) Psychiatric Services pp. 967–973 

(2013). 

234Carve-out plans are defined as plans that only 

administer behavioral health benefits. (See Sarah A. 

Friedman, Francisca Azocar, Haiyong Xu, & Susan 

L. Ettner, The Mental Health Parity and Addiction 

Equity Act (MHPAEA) Evaluation Study: Did Parity 

Differentially Affect Substance Use Disorder and 

Mental Health Benefits Offered by Behavioral 

Healthcare Carve-Out and Carve-In Plans, 190 Drug 

and Alcohol Dependence pp. 151–158 (2018).) 

235Alisa Busch, Frank Yoon, Colleen Barry, 

Banessa Azzone, Sharone-Lisa Normand, Howard 

Goldman, & Haiden Huskamp, The Effects of Parity 

on Mental Health and Substance Use Disorder 

Spending and Utilization: Does Diagnosis Matter? 

172(2) American Journal of Psychiatry pp. 180–187 

(Feb. 2013). 

and administrative data spanning from 

1998 to 2008, the study employed a 

difference-in-differences model and 

found that State parity laws reduced the 

suicide rates, increased college grade 

point averages, and reduced the 

likelihood of college-level students 

reporting any poor mental health days. 

However, the study did not find 

evidence that State parity laws affect the 

likelihood of disenrolling from college. 

These findings remain consistent even 

after subjecting the analysis to several 

robustness checks. The authors 

acknowledged some limitations in the 

study. Specifically, the reported number 

of poor mental health days reported is 

based on self-assessment, rather than on 

clinical measures. There is also a 

possibility of underreporting due to the 

stigma associated with mental health.229

Finally, a 2015 study examined the 

effect of State parity laws on individuals 

aged 25 to 64 with moderate levels of 

distress.230 Using individual-level data 

from the National Health Interview 

Survey (1997 to 2001) and the Medical 

Expenditure Panel Survey (1998 to 

2003), the study employed a tripledifference model and found a 

statistically significant increase in 

employment, weekly wages, and the 

number of hours worked following the 

passage of parity. The authors noted that 

the results do not indicate a shift in the 

labor demand curve, but rather an 

increase in the productivity of workers 

with moderate levels of distress.231

Although the previous three studies 

suggest mental health outcomes may 

improve following the initiation of State 

parity policies, it is not clear from this 

research the mechanism driving any 

outcome improvements. Given a lack of 

data in both studies, the authors cannot 

directly show that State parity laws 

increase mental healthcare utilization. 

The causal impact of these policies, 

including whether parity would 

increase mental healthcare utilization, 

which would in turn improve health 

outcomes such as the suicide rate, can 

therefore not be directly ascertained. 

Absent any utilization increases, it is 

possible that parity policies could 

improve the quality of care itself 

without additional demand, but further 

research is needed to answer how 

specifically parity laws affect 

downstream health outcomes. 

6.1.3. Research Finding State Parity 

Laws Have Statistically Insignificant 

Effects 

In contrast, some studies have found 

that State parity laws did not 

significantly improve access to mental 

health and substance use disorder care. 

For instance, a 2000 study focused on 

patients with mental health needs 

examined the impact of State parity 

laws on their insurance coverage, with 

varying specifications which defined 

this as insurance status, insurance 

generosity, and perceived access to care. 

Using national survey data from 1996 to 

1998, the study found no statistically 

significant impact on insurance 

coverage or access to care for patients 

with mental health needs following the 

passage of State parity laws. The authors 

attributed this finding to several 

limitations of the study, including a 

relatively small sample size which 

limited the narrowness of State parity 

laws in terms of impact types of 

insurance coverage, and the significant 

number of individuals with mental 

health or substance use disorders who 

do not have health insurance coverage. 

Most significantly, while the study 

examined the impact of parity laws on 

access to insurance and care, it was not 

limited to behavioral health care and so 

the impact on those interventions may 

not have been statistically significantly 

captured.232

Furthermore, a 2013 study examined 

how State parity laws affected access to 

mental health care services for privately 

insured children and youths aged three 

to 17 with ASD. Using national survey 

data from 2005 to 2006 and adjusting for 

potential selection bias of States that 

enacted parity legislation, the study did 

not find evidence that State parity laws 

increased the utilization of mental 

health services for children with ASD. 

The authors suggested that differences 

in the availability of services, therapies, 

and treatments across States could 

explain this lack of impact, as these 

children may not benefit from the same 

protections and service access afforded 

to children with other mental health 

conditions under State parity laws. 

Additionally, the authors acknowledged 

limitations in their analysis, noting that 

the study did not provide information 

on the implementation of State parity 

laws. They cautioned that measurement 

errors could arise due to the potential 

delayed effects associated with varying 

implementation timelines of the State 

parity laws.233

6.2. Research Examining the Impact of 

MHPAEA on Utilization 

Several studies have investigated the 

effect MHPAEA had on utilization of 

treatment for mental health conditions 

or substance use disorders. In general, 

the studies have found either a small or 

no effect on utilization after the 

implementation of MHPAEA. 

For instance, a 2014 study analyzed 

pooled data from seven Federal 

Employees Health Benefits (FEHB) 

plans, four of which contracted with 

carve-out plans 234 before and after 

parity implementation, two 

implemented carve-out plans when 

parity took effect, and one was not a 

carve-out plan. The authors looked at 

annual utilization, including 

psychotherapy visits, medication 

management visits, inpatient mental 

health or substance use disorder days, 

and mental health of substance use 

disorder prescription fills, for three 

target diagnoses: bipolar disorder, major 

depression, and adjustment disorder. 

Using a difference in differences model, 

the authors found a 12-percent 

statistically significant decrease in 

annual psychotherapy utilization for 

individuals diagnosed with adjustment 

disorders, and a statistically significant 

decrease in out-of-pocket spending for 

enrollees across all three diagnostic 

categories (ranging from $78 to $86) 

following parity implementation, and 

found no significant change for all other 

metrics. The authors opine that the 

observed decline in psychotherapy 

utilization may be related to the Office 

of Personnel Management’s 

encouragement that FEHB plans utilize 

benefit management techniques to 

control spending increases following 

parity implementation.235


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236Susan Ettner, Jessica Harwood, Amber 

Thalmayer, Michael Ong, Haiyong Xu, Michael 

Bresolin, Kenneth Wells, Chi-Hong Tseng, & 

Francisca Azocar, The Mental Health Parity and 

Addiction Equity Act Evaluation Study: Impact on 

Specialty Behavioral Health Utilization and 

Expenditures Among ‘‘Carve-Out’’ Enrollees, 50 

Journal of Health Economics pp. 131–143 (2016). 

237Noah Mulvaney-Day, Brent Gibbons, Shums 

Alikhan, & Mustafa Karakus, Mental Health Parity 

and Addiction Equity Act and the Use of Outpatient 

Behavioral Health Services in the United States, 

2005–2016, 109(3) American Journal of Public 

Health pp. 190–196 (2019). 

238The study defined the ‘‘transition’’ period as 

‘‘when good-faith efforts at compliance with respect 

to coinsurance, copayments, combined medicalbehavioral health deductibles, and quantitative 

treatment limits went into effect for plans renewing 

on a calendar-year basis.’’ 

239Sarah Friedman, Haiyong Xu, Jessica M. 

Harwood, Francisca Azocar, Brian Hurley & Susan 

L. Ettner, The Mental Health Parity and Addiction 

Equity Act Evaluation Study: Impact on Specialty 

Behavioral Healthcare Utilization and Spending 

Among Enrollees with Substance Use Disorders, 80 

Journal of Substance Abuse Treatment pp. 67–78 

(2017). 

240Harwood, Jessica M., Francisca Azocar, Amber 

Thalmayer, Haiyong Xu, Michael K. Ong, Chi-Hong 

Tseng, Kenneth B. Wells, Sarah Friedman, & Susan 

L. Ettner, The Mental Health Parity and Addiction 

Equity Act Evaluation Study: Impact on Specialty 

Behavioral Health Care Utilization And Spending 

Among Carve-In Enrollees, 55(2) Medical Care pp. 

164–172 (2017); and Susan L. Ettner, Jessica M. 

Harwood, Amber Thalmayer, Michael K. Ong, 

Haiyong Xu, Michael J. Bresolin, Kenneth B. Wells, 

Chi-Hong Tseng, & Francisca Azocar, The Mental 

Health Parity and Addiction Equity Act Evaluation 

Study: Impact on Specialty Behavioral Health 

Utilization and Expenditures Among Carve-Out 

Enrollees, 50 Journal of Health Economics pp. 131– 

143 (2016). 

241Emma E. McGinty, Susan H. Busch, Elizabeth 

A. Stuart, Haiden A. Huskamp, Teresa B. Gibson, 

Howard H. Goldman, & Colleen L. Barry, Federal 

Parity Law Associated with Increased Probability of 

Using Out-Of-Network Substance Use Disorder 

Treatment Services, 34(8) Health Affairs pp. 1331– 

1339 (2015). 

242The study defined ‘‘treatment initiation’’ as 

the ‘‘share of enrollees with a new episode of SUD 

treatment who initiated treatment within 14 days of 

their initial diagnosis.’’ 

243The study defined ‘‘treatment engagement’’ as 

the ‘‘share of enrollees with a new episode of SUD 

treatment who receive at least two SUD services 

within 30 days of their initial diagnosis.’’ 

Along the same lines, a 2016 study 

used an interrupted time series model to 

investigate the effect of MHPAEA on the 

probability of specialty behavioral 

health treatment, levels of utilization, 

and expenditures for enrollees aged 27 

to 64 in group health plans between 

2008 and 2013, with Optum carve-outs. 

The authors focused on the following 

outcomes: expenditures (insurer and 

patient), number of outpatient visits 

(assessment/diagnostic evaluation, 

individual psychotherapy, family 

psychotherapy, and medication 

management), and number of days of 

care (structure outpatient, day 

treatment, residential care, and acute 

inpatient care). In the post-parity 

period, 2011 to 2013, the effect of parity 

differed by type of care: the probability 

of using any assessment/diagnostic 

evaluation, medication management, of 

family psychotherapy visits decreased, 

while the probability of using structure 

outpatient care and inpatient care 

increased. Under multiple specifications 

and sensitivity tests, the authors found 

that parity had ‘‘modest to no effect on 

service use.’’ Though they did find 

modest evidence that costs shifted from 

patient to health plans.236

Similarly, a 2019 study looked at 

insurance claims of enrollees under age 

65 with continuous enrollment in a 

large group, employer-sponsored fully 

insured health plan between January 

2005 and September 2015 to analyze 

whether parity implementation was 

associated with utilization and spending 

changes in behavioral health services 

compared to medical/surgical services. 

Parity had a positive but small, 

statistically significant impact on the 

share of enrollees that used any 

outpatient substance use disorder 

services. Specifically, parity increased 

the percentage of enrollees that used 

any outpatient substance use disorder 

services by 0.023 percentage points in 

the first year following the 

implementation of MHPAEA and 0.068 

percentage points by the end of 2015 

relative to pre-MHPAEA levels. The 

authors also found that parity led to an 

increase in the average frequency of 

monthly services per user for both 

mental health and substance use 

disorder services, at a rate of 0.05 

services per user for mental health 

services and 0.054 services per user for 

substance use disorder services. This 

implies that people receiving services 

received more services, on average.237

6.3. Research Examining the Impact of 

MHPAEA on Spending 

Research has found mixed evidence 

on the impact of MHPAEA on spending. 

Some studies did not identify a change 

in out-of-pocket spending following the 

passage of MHPAEA, whereas others 

found that MHPAEA increased out-ofpocket spending on substance use 

disorder care. 

For instance, a 2017 study examined 

whether MHPAEA increased behavioral 

health expenditures and utilization 

among a population with substance use 

disorders. Using Optum’s claims and 

eligibility data from 2008 to 2013, the 

authors compared the utilization and 

expenditures for adults with alcohol or 

drug use disorders across several 

periods: pre-parity (2008 to 2009), 

transition period (2010),238 and postparity period (2011 to 2013). They 

found that for carve-out plans managed 

by Optum, MHPAEA was associated 

with modest increases in total spending, 

plan spending, and patient out-ofpocket spending, as well as outpatient 

and inpatient utilization. Although the 

increases were mostly small in 

magnitude, they were evident across 

different types of care, potentially 

indicating small improvements in the 

accessibility to various substance use 

disorder treatments.239 The authors note 

that these results are similar to other 

studies, which used the same data when 

examining adults in carve-in plans and 

carve-out plans.240

Additionally, a 2015 study examined 

whether MHPAEA was associated with 

changes in the out-of-network services 

for substance use disorder services. 

Using a 2007 to 2012 longitudinal, 

commercial claims database and 

employing an interrupted time-series 

design to analyze these effects, the study 

found that MHPAEA was associated 

with an increased probability of using 

out-of-network services at a rate of 

0.0024 service users per month, an 

increased number of out-of-network outpatient visits at a rate of 0.0016 service 

users per month, and an increased 

average total spending on out-ofnetwork services by $49.81 per user per 

month, though it was found to have no 

effect on out-of-pocket spending. This 

result would represent a shift in 

expenses borne by the insurer, which 

might or might not be passed through to 

the insured through higher premiums, 

but the study lacked the data to assess 

this possibility. The authors 

acknowledged that the study was not 

able to examine the adequacy of 

substance use disorder provider 

networks, which may have influenced 

enrollees pursuit of out-of-network 

care.241

Finally, a 2014 study examined the 

impact of MHPAEA on the utilization 

and spending of substance use disorder 

treatments. Using 2009 to 2010 

administrative claims data from Aetna 

insurance, the study compared changes 

in outcomes among health plan 

enrollees one year before (2009) and one 

year after (2010) the implementation of 

MHPAEA, compared to enrollees 

covered by State parity laws in place 

prior to MHPAEA. The study found the 

MHPAEA was associated with a modest 

increase in spending on substance use 

disorder treatments ($9.99 per health 

plan enrollee), but did not find 

significant changes in treatment 

initiation,242 treatment engagement,243

or out-of-pocket spending. The authors 

acknowledged that these findings may 

not be generalizable to other insurance 

or population contexts, since the study 


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244Susan H. Busch, Andrew J. Epstein, Michael 

O. Harhay, David A. Fiellin, Hyong Un, Deane 

Leader Jr, & Colleen L. Barry, The Effects of Federal 

Parity on Substance Use Disorder Treatment, 20(1) 

The American Journal of Managed Care (2014). 

245See CBO, Summary Estimate for Divisions M 

Through FF, H.R. 133, Consolidated Appropriations 

Act, 2021 (Pub. L. 116–260), as Enacted on 

December 27, 2020 (Jan. 14, 2021), https://

www.cbo.gov/system/files/2021-01/PL_116-260_

Summary.pdf. 

246 2022 MHPAEA Report to Congress, https://

www.dol.gov/sites/dolgov/files/EBSA/laws-andregulations/laws/mental-health-parity/report-tocongress-2022-realizing-parity-reducing-stigmaand-raising-awareness.pdf. 

247 2023 MHPAEA Comparative Analysis Report 

to Congress, www.dol.gov/sites/dolgov/files/EBSA/ 

laws-and-regulations/laws/mental-health-parity/

report-to-congress-2023-mhpaea-comparativeanalysis.pdf. 

evaluated the effects of parity on 

individuals insured by a single health 

insurer in 10 States with pre-existing 

State parity laws. Moreover, the study 

examined only the first year following 

MHPAEA’s effective date, which may 

not have fully captured its 

implementation.244 As discussed in 

section IV.2.2, the Departments have 

published regulations and extensive 

guidance to facilitate the 

implementation and enforcement of 

MHPAEA. 

7. Benefits 

The Departments expect that these 

final rules will improve the quality of 

the comparative analyses performed and 

documented by plans and issuers 

required by MHPAEA, as amended by 

the CAA, 2021; help plans and issuers 

better understand and fulfill their 

obligations under MHPAEA; and 

promote greater clarity regarding 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

By specifying more details on how to 

perform and document NQTL 

comparative analyses, the Departments 

expect improvements in plan and issuer 

compliance with the requirements for 

imposing NQTLs under MHPAEA, and 

by doing so, increased access for 

participants, beneficiaries and enrollees 

to mental health and substance use 

disorder services. 

Thus, these final rules will generate 

the following economic and societal 

benefits for participants, beneficiaries, 

and enrollees: 

• improved understanding of and 

compliance with MHPAEA by plans and 

issuers, resulting in better frameworks 

for regulators, plans, and issuers to 

determine whether plans and issuers are 

complying with MHPAEA with respect 

to NQTLs applicable to coverage of 

mental health and substance use 

disorder benefits, 

• greater access and utilization of 

mental health and substance use 

disorder services in response to a 

reduction in barriers to mental health 

and substance use disorder coverage 

(the greater utilization being a cost of 

the rule), resulting in better health 

outcomes among those with mental 

health conditions or substance use 

disorders, and 

• reduced adverse impacts on the 

families, friends, caregivers, and 

coworkers of people who suffer from 

untreated or under treated mental health 

conditions or substance use disorders 

based on their improved access to 

treatment. 

This analysis provides a mainly 

qualitative discussion of the benefits 

associated with these final rules, as the 

Departments do not have the data 

necessary to quantify the likely benefits 

associated with the additional guidance 

and its impact on ensuring better 

compliance with the rules related to 

NQTLs and access to mental health and 

substance use disorder benefits. Where 

possible, however, the Departments 

have provided estimates to illustrate 

some of the benefits of these final rules. 

The illustrative calculations address 

overlapping phenomena and thus are 

not summed due to the noteworthy 

potential for double-counting 

(moreover, for only a subset of the 

illustrated benefits have the associated 

treatment costs been quantified). 

In addition, the Departments have 

identified several transfers that will 

occur due to this rulemaking, such as 

decreases in out-of-pocket spending and 

increases in premiums. These transfers 

are discussed in section IV.9 of this 

regulatory impact analysis. 

The Departments requested comments 

and data in the proposed rules related 

to how the Departments might quantify 

these benefits. While one commenter 

stated that the Departments had not 

quantified the benefits of the proposal, 

they did not provide any data or 

recommendations on how these benefits 

could be quantified. Another 

commenter suggested that the 

Congressional Budget Office’s (CBO) 

cost estimate 245 of the CAA, 2021 may 

help the Departments to quantify the 

benefits of the proposal. However, the 

CBO report primarily focuses on the 

program cost of CAA, 2021, rather than 

addressing the specific impact of the 

additional requirements for 

documenting comparative analyses, and 

therefore the Departments are not able 

to utilize it for quantifying the benefits 

of these final rules. 

7.1. Improved Understanding of and 

Compliance With MHPAEA by Plans 

and Issuers 

As noted earlier, the 2022 MHPAEA 

Report to Congress 246 found that none 

of the comparative analyses reviewed by 

the Departments under the first year of 

the CAA, 2021, contained sufficient 

information and documentation from 

plans and issuers upon initial receipt 

and nearly all were similarly deficient 

for the 2023 MHPAEA Comparative 

Analysis Report to Congress.247 As a 

result, the Departments had to make 

numerous requests for additional 

information. This process is costly for 

plans, issuers, and the Departments, and 

undermines the effectiveness of 

MHPAEA. 

These final rules will clarify and 

strengthen the obligations of plans and 

issuers under MHPAEA, thus promoting 

compliance, by: 

• placing renewed focus on the 

elimination of more restrictive barriers 

to access to mental health and substance 

use disorder benefits as compared to 

medical/surgical benefits, 

• standardizing the definitions 

associated with the parity analysis for 

NQTLs applicable to mental health and 

substance use disorder benefits and 

medical/surgical benefits, 

• providing examples of the 

application of MHPAEA to NQTLs, and 

• setting forth the content and data 

evaluation requirements of the NQTL 

comparative analyses. 

These final rules will help parties 

better understand what plans and 

issuers need to do to comply with 

MHPAEA, reduce uncertainty about 

compliance status, and help plans and 

issuers better identify areas they need to 

improve upon as well as reduce the 

need to revise analyses upon the 

Departments identifying noncompliance. In the course of 

implementing these final rules, the 

Departments anticipate that parties will 

adjust their policies and procedures in 

order to come into compliance and offer 

better coverage of mental health and 

substance use benefits to participants, 

beneficiaries, and enrollees. 

Many commenters supported 

modifying existing definitions and 

adding new ones to the MHPAEA 

regulations, particularly for terms such 

as ‘‘medical/surgical benefits,’’ ‘‘mental 

health benefits,’’ and ‘‘substance use 

disorder benefits.’’ Commenters stated 

that these definitions would 

significantly improve clarity for plans 

and issuers. One commenter stated the 

proposal would clearly specify how 

mental health and substance use 

disorder benefits must be defined for 

MHPAEA compliance purposes, 

minimize situations where 


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248The effective date for MHPAEA for calendar 

year plans is January 1, 2010. See CMS, The Mental 

Health Parity and Addiction Equity Act of 2008 

(MHPAEA) (2010). 

249 Dominic Hodgkin, Constance M. Horgan, 

Maureen T. Stewart, Amity E. Quinn, Timothy B. 

Creedon, Sharon Reif, & Deborah W. Garnick, 

Federal Parity and Access to Behavioral Health 

Care in Private Health Plans, 69(4) Psychiatric 

Services pp. 396–402 (2018). 

250Thalmayer, Amber Gayle, Sarah A. Friedman, 

Francisca Azocar, Jessica M. Harwood, & Susan L. 

Ettner, The Mental Health Parity and Addiction 

Equity Act (MHPAEA) Evaluation Study: Impact on 

Quantitative Treatment Limits, 68(5) Psychiatric 

Services pp. 435–442 (2017). 

251Norah Mulvaney-Day, Brent J. Gibbons, Shums 

Alikhan, & Mustafa Karakus, Mental Health Parity 

and Addiction Equity Act and the Use of Outpatient 

Behavioral Health Services in the United States, 

2005–2016, 109(S3) American Journal of Public 

Health pp. S190–S196 (2019). 

252 Xiaoxue Li & Jie Ma, Does Mental Health 

Parity Encourage Mental Health Utilization Among 

Children and Adolescents? Evidence From the 2008 

contradictions with State guidelines 

limit protections under MHPAEA, and 

ensure that plans appropriately classify 

mental health and substance use 

disorder benefits and medical/surgical 

benefits. The Departments acknowledge 

the supportive comments and agree that 

modifying and adding definitions, 

particularly for key terms like ‘‘medical/ 

surgical benefits,’’ ‘‘mental health 

benefits,’’ and ‘‘substance use disorder 

benefits,’’ will enhance clarity and 

ensure consistent application of the 

MHPAEA requirements across plans 

and issuers, and have done so in these 

final rules. 

Commenters also expressed support 

for clarifying the application of 

MHPAEA’s requirements to NQTLs. 

One commenter stated that the proposal 

provides more specificity for plans and 

issuers to assess their NQTLs applicable 

to mental health or substance use 

disorder benefits, and the information 

that must be included in a comparative 

analysis of NQTLs applicable to mental 

health and substance use disorder 

benefits and medical/surgical benefits. 

The commenter further stated the 

proposal reduces uncertainty for all 

parties, while providing greater clarity 

for consumers and other stakeholders to 

assess whether an NQTL is compliant 

with MHPAEA. Additionally, the 

commenter stated that the proposal 

provides greater clarity for insurers and 

patients and helps State insurance 

regulators better enforce existing 

regulations. The Departments 

acknowledge the supportive comments 

and agree that the final rules provide 

clarity to the statutory requirements for 

the regulated community and other 

interested parties. 

However, some commenters 

expressed concern regarding whether 

certain policies and procedures would 

now be prohibited under MHPAEA, as 

interpreted through the proposed rules, 

if finalized. One commenter, in 

objecting to the proposed mathematical 

substantially all and predominant tests, 

stated that the most significant cost is 

not in conducting the comparative 

analysis, but rather in the additional 

expenses incurred should plans and 

issuers no longer be able to utilize 

common medical management 

techniques that improve cost and 

quality outcomes, such as prior 

authorization and concurrent review. 

As stated earlier in this preamble, the 

Departments are not finalizing the 

proposed mathematical test for applying 

the substantially all and predominant 

tests in these final rules. These final 

rules also do not eliminate the use of 

prior authorization or other medical 

management NQTLs applicable to both 

mental health and substance use 

disorder benefits and medical/surgical 

benefits. However, NQTLs applicable to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits must be designed and applied 

in compliance with MHPAEA’s parity 

requirements. Moreover, as discussed 

earlier in this preamble, the 

Departments anticipate that these final 

rules will promote changes in network 

composition and medical management 

techniques that result in more robust 

mental health and substance use 

disorder provider networks, as well as 

fewer and less restrictive prior 

authorization requirements for 

individuals seeking mental health and 

substance use disorder treatment. While 

this could increase costs in some cases, 

there are potential offsetting benefits in 

other cases for the reduction in the use 

of medical management techniques. 

7.2. Greater Access to Mental Health 

and Substance Use Disorder Treatments 

By improving plan and issuer 

understanding of the requirements 

under MHPAEA and clarifying how 

comparative analyses must be 

performed and documented, these final 

rules will improve compliance. 

Specifically, this will ensure 

compliance with the design and 

application requirements and the 

relevant data evaluation requirements so 

that NQTLs applied to mental health 

and substance use disorder benefits are 

no more restrictive than the 

predominant limitation applicable to 

substantially all medical/surgical 

benefits. The Departments are of the 

view that this will, in turn, expand 

access to and utilization of mental 

health and substance use disorder 

services. These final rules will have the 

greatest direct benefits for individuals 

who currently forego treatments or 

cannot access specialized care for a 

mental health condition or substance 

use disorder because their plan or 

coverage imposes barriers to accessing 

benefits for coverage of these services 

that are greater than the barriers for 

accessing medical/surgical services. 

The Departments do not have 

sufficient data to estimate how many 

participants, beneficiaries, and enrollees 

will receive treatment, or more 

appropriate treatment, as a result of 

these final rules. However, research has 

demonstrated that participants, 

beneficiaries, and enrollees experienced 

increased access to mental health and 

substance use disorder treatments 

following the implementation of 

MHPAEA. Drawing on these studies, the 

Departments expect that this 

rulemaking, in further improving 

compliance with MHPAEA, will result 

in significant improvements in access to 

mental health and substance use 

disorder care. 

For example, a 2018 study examined 

how MHPAEA affected the coverage of 

commercial health plans in the United 

States. The study found that between 

2010 248 and 2014, 68 percent of 

insurance products had expanded 

behavioral health coverage, and among 

plans that expanded services, 96 percent 

reported it was in part because of parity 

requirements.249 Further, a 2017 study 

examined the prevalence of behavioral 

health quantitative treatment limitations 

in large group health plans that utilized 

carve-out and carve-in services of a 

single service provider. While prior to 

implementation of MHPAEA, 

quantitative treatment limitations 

existed, following its implementation 

virtually all of those plans had 

eliminated quantitative treatment 

limitations.250 A 2019 study of claims 

data from both a pre-parity (January 

2005 through December 2010) and postparity period (January 2011 through 

September 2015), found that while 

MHPAEA did not appreciably increase 

the share of participants utilizing any 

outpatient mental health services, it did 

increase the frequency of use and total 

utilization of outpatient mental health 

and substance use disorder services of 

participants already receiving these 

services.251 Moreover, a 2020 study of 

MHPAEA, using 2007 and 2011 to 2012 

data from the National Survey of 

Children’s Health, found that among 

children and adolescents with family 

income between 150 and 400 percent of 

the Federal poverty level in States 

without prior parity laws, the enactment 

of MHPAEA resulted in a 2.8- 

percentage-point increase in mental 

health care utilization.252


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77671 

Mental Health Parity and Addiction Equity Act 

(MHPAEA), 47(1) The Journal of Behavioral Health 

Services & Research pp. 38–53 (2020). 253 Jane M. Zhu, Yuehan Zhang, & Daniel Polsky, 

Networks in ACA Marketplaces are Narrower for 

Mental Health Care than for Primary Care, 36(9) 

Health Affairs pp. 1624–1631 (Sept. 2017). 254Senate Committee on Finance Majority, 

Majority Study Findings: Medicare Advantage Plan 

Directories Haunted by Ghost Networks (2023), 

https://www.finance.senate.gov/imo/media/doc/ 

050323%20Ghost%20Network%20Hearing%20- 

%20Secret%20Shopper%20Study%20Report.pdf. 

255 GAO, Mental Health Care: Access Challenges 

for Covered Consumers and Relevant Federal 

Efforts, GAO–22–104597 (Mar. 2022), https://

www.gao.gov/assets/gao-22-104597.pdf. 

256Susan H. Busch & Kelly A. Kyanko, Incorrect 

Provider Directories Associated with Out-ofNetwork Mental Health Care and Outpatient 

Surprise Bills, 39(6) Health Affairs pp. 975–983 

(June 2020). 

257Constance M. Horgan, Dominic Hodgkin, 

Maureen T. Stewart, Amity Quinn, Elizabeth L. 

Merrick, Sharon Reif, Deborah W. Garnick, & 

Timothy B. Creedon, Health Plans’ Early Response 

to Federal Parity Legislation for Mental Health and 

Addiction Services, 67(2) Psychiatric Services pp. 

162–168 (2016). 

258Matthew Lang, The Impact of Mental Health 

Insurance Laws on State Suicide Rates, 22(1) Health 

Economics, pp. 73–88 (2013). 

These final rules will directly benefit 

individuals who are currently enrolled 

in a plan with narrower networks, with 

regard to mental health and substance 

use disorder benefits compared to the 

networks for medical/surgical benefits, 

which prevent participants, 

beneficiaries, and enrollees from being 

able to access care from in-network 

providers and receive the benefits they 

need. A 2017 study of ACA Marketplace 

provider networks found that mental 

health networks were significantly 

narrower on average than primary care 

networks, providing less than half the 

share of providers practicing within a 

State-level market.253 A 2023 secret 

shopper study conducted by the Senate 

Committee on Finance contacted 10 

providers from directories of 12 plans, 

making a total of 120 calls. The study 

found that more than 80 percent of 

mental health providers contacted were 

either unreachable, not in-network, or 

not accepting new patients.254

Ghost or phantom networks— 

collections of providers and facilities 

that are listed as being within a plan’s 

or issuer’s network but, in fact, are not 

available to participants, beneficiaries, 

and enrollees for treatment on an innetwork basis—make it difficult for 

participants to find in-network 

providers.255 One 2020 national survey 

of privately insured individuals that 

received mental health treatment found 

that more than half of those patients that 

used a provider directory encountered 

inaccuracies which made them more 

likely to be treated by an out-of-network 

provider, and four times as likely to 

receive a surprise, out-of-network 

bill.256

In response to the Departments’ 

proposal, numerous commenters stated 

that they believed the proposed rules 

would benefit patients, specifically by 

improving access to mental health and 

substance use disorder treatments. 

Several commenters stated the proposed 

rules would ensure more equitable 

access to care by addressing 

burdensome administrative practices, 

such as NQTLs and other utilization 

management techniques, which 

negatively impact patient access to 

mental health and substance use 

disorder benefits. Additionally, many 

other commenters suggested that the 

enhanced clarity and transparency 

provided by the proposed rules would 

alleviate administrative burdens and, as 

such, help to streamline access to 

behavioral health care. The Departments 

acknowledge these supportive 

comments and agree that the final rules 

will increase access to mental health 

and substance use disorder treatments. 

Given those concerns highlighted by 

commenters regarding challenges 

related to accessing mental health 

substance use disorder benefits, the 

final rules particularly highlight parity 

in NQTLs related to network 

composition as an area that requires 

improvement. By requiring plans and 

issuers to collect and evaluate relevant 

data on provider networks, including for 

network composition NQTLs, the final 

rules will help to ensure that 

individuals have more equitable access 

to in-network providers that are 

available to provide care for mental 

health conditions and substance use 

disorders. Additionally, by ensuring 

that plans and issuers collect and 

evaluate data related to NQTLs for 

network composition for mental health 

and substance use disorder benefits and 

medical/surgical benefits, and as 

necessary address material differences 

in access between these benefits, the 

Departments expect that the final rules 

will improve the ability of participants, 

beneficiaries, and enrollees to access 

available in-network mental health and 

substance use disorder providers. Thus, 

the final rules will reduce barriers to 

accessing mental health and substance 

use disorder care. 

This discussion focuses on the 

benefits for participants, beneficiaries, 

and enrollees who were previously 

prevented from receiving mental health 

or substance use disorder treatment. For 

a discussion of the effects on 

participants, beneficiaries, and enrollees 

who were previously paying out-ofpocket for treatment, refer to section 

IV.9.1 of this regulatory impact analysis 

pertaining to transfers. 

The implementation of the CAA, 2023 

provision that sunsets the MHPAEA 

opt-out election is expected to reduce 

financial and non-financial barriers to 

accessing mental health and substance 

use disorder treatment for participants 

and beneficiaries of self-funded nonFederal governmental plans that elected 

to opt out of requirements under 

MHPAEA. This is expected to result in 

increased access to mental health and 

substance use disorder care and, as 

discussed in more detail in the section 

IV.7.3, lead to better health outcomes for 

plan participants and beneficiaries who 

need mental health or substance use 

disorder services. 

7.3. Better Health Outcomes Among 

Those With Mental Health Conditions 

and Substance Use Disorders 

The Departments are of the view that 

by ensuring parity in medical 

management techniques and other 

NQTLs imposed by plans and issuers, 

the final rules will reduce barriers for 

participants, beneficiaries, and enrollees 

seeking mental health and substance use 

disorder care. As discussed later in this 

regulatory impact analysis, the removal 

of barriers preventing individuals from 

accessing mental health and substance 

use disorder treatment on par with 

medical/surgical treatment will in turn 

produce better patient outcomes, 

including potentially lives saved. 

Research has demonstrated that 

MHPAEA has already had a positive 

effect on improving access to treatment. 

A 2016 study examining the initial 

effects of MHPAEA found that following 

implementation, prior authorization 

requirements were less common for 

behavioral health care services than in 

previous years.257 Further, removal of 

treatment limitations has had significant 

beneficial impacts in the mental health 

and substance use disorder space. A 

2013 study, which analyzed changes in 

suicide rates by age groups before and 

after State parity laws were enacted, 

found that, controlling for State-specific 

time trends, enactment of parity laws 

was associated with a 5-percent 

decrease in suicides.258 It is worth 

noting, however, that State parity laws 

do not apply to most self-funded 

employer-sponsored health coverage, 

which comprise a large portion of the 

population in States affected by these 

final rules. As such, the impact of the 

laws in that study may have been 

somewhat dampened. For a more 

detailed description of this study, see 

section IV.6.1. 

If, as the Departments expect, these 

final rules similarly increase access to 

mental health and substance use 


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77672 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

259CDC, National Center for Health Statistics, 

Provisional Estimates of Suicide by Demographic 

Characteristics: United States, 2022, Report No. 34 

(Nov. 2023), https://www.cdc.gov/nchs/data/vsrr/ 

vsrr034.pdf. 

260Agency for Healthcare Research and Quality, 

2022 National Healthcare Quality and Disparities 

Report, Child and Adolescent Mental Health (Oct. 

2022), https://www.ncbi.nlm.nih.gov/books/ 

NBK587174/. 

261Based on the Departments’ tabulations of 

adults with non-Federal employer-sponsored 

insurance (ESI) and/or private health insurance 

(157.4 million) and the number of children 12–17 

with non-Federal ESI and/or private health 

insurance (15.5 million) off the March 2022 CPS 

Auxiliary Data (https://www.dol.gov/agencies/ebsa/ 

researchers/data/auxiliary-data). 

262The estimate is calculated as follows: 

157,443,601 participants with commercial health 

insurance × 0.014-percent adult suicide fatality = 

22,200 adult suicide fatalities. 

263The estimate is calculated as follows: 

15,541,261 children aged 12–17 with private health 

insurance × 0.0063-percent suicide fatalities = 979 

fatalities. 

264This estimate of a 2-percent reduction is based 

on the estimate of 5 percent previously cited, 

revised downward by 60 percent to account for the 

indirect impact of the final rule on access, 

compared to the initial introduction of mental 

health parity laws. See Matthew Lang, The Impact 

of Mental Health Insurance Laws on State Suicide 

Rates, 22(1) Health Economics, pp. 73–88 (2013). 

265The estimate is calculated as follows: 22,200 

fatalities from suicide × 2-percent reduction in 

suicides = 444 fatalities prevented. 

266The estimate is calculated as follows: 979 

fatalities from suicide × 2-percent reduction in 

suicides = 20 fatalities prevented. 

267 DOT, Departmental Guidance on Valuation of 

a Statistical Life in Economic Analysis, effective 

May 7, 2024, https://www.transportation.gov/officepolicy/transportation-policy/revised-departmentalguidance-on-valuation-of-a-statistical-life-ineconomic-analysis. 

268The VSL utilized by the Departments in this 

analysis is one of several VSLs estimated by Federal 

agencies, all of which vary slightly in their 

estimated VSL. The HHS VSL in 2024 is $13.1 

million. More information on the HHS VSL can be 

found in HHS Standard Values for Regulatory 

Analysis, 2024 (Jan. 25, 2024) at https://

aspe.hhs.gov/sites/default/files/documents/ 

cd2a1348ea0777b1aa918089e4965b8c/standardria-values.pdf. 

269This estimate is calculated as follows: 444 

adult fatalities prevented + 20 youth fatalities 

prevented × $13,200,000 VSL = $6,124,800,000. 

270Some methodological approaches to the VSL 

apply a distinct, and often higher, value to children. 

While the Departments do not utilize such an 

approach here, they recognize this estimate may 

undervalue the true benefits as the final rules’ 

effects include a risk reduction of fatality to minor 

children. 

271 Individuals express a different willingness to 

pay to reduce the fatality risk of some deaths (those 

with a perceived associated morbidity, such as 

cancer) more than others (such as car accidents), 

though the risks may be equivalent. DOT guidance 

on the VSL suggests utilizing a single, nationwide 

value that does not adjust the VSL based on the 

nature of the risk or the underlying characteristics 

of the affected population but encourages a 

sensitivity analysis to reflect such uncertainty. 

272For more information on the VSL guidance 

utilized, see the DOT’s Revised Departmental 

Guidance on Valuation of a Statistical Life in 

Economic Analysis, https://

www.transportation.gov/office-policy/ 

transportation-policy/revised-departmentalguidance-on-valuation-of-a-statistical-life-ineconomic-analysis. 

273The lower and upper bounds are estimated as 

40 percent below and above the central estimate of 

$13,200,000, per DOT guidance on conducting a 

sensitivity analysis for a VSL estimate. 

274These estimates are calculated as: The lower 

VSL estimate of $5,280,000 × 464 fatalities 

prevented = $2,447,665,113. The lower VSL 

estimate of $18,480,000 × 464 fatalities prevented 

= $8,566,827,999. 

275Serious mental illness is defined as a ‘‘mental, 

behavioral, or emotional disorder resulting in 

serious functional impairment, which substantially 

interferes with or limits one or more major life 

activities.’’ (See National Institute of Health, Mental 

Illness, https://www.nimh.nih.gov/health/statistics/ 

mental-illness) 

276Peter J. Uhlhaas, Christopher G. Davey, 

Urvakhsh Meherwan Mehta, Jai Shah, John Torous, 

Nicholas B. Allen, Shelli Avenevoli, Tolulope 

Bella-Awusah, Andrew Chanen, Eric Y. H. Chen, 

Christoph U. Correll, Kim Q. Do, Helen L. Fisher, 

Sophia Frangou, Ian B. Hickie, Matcheri S. 

Keshavan, Kerstin Konrad, Francis S. Lee, Cindy H. 

Liu, Beatriz Luna, Patrick D. McGorry, Andreas 

Meyer-Lindenberg, Merete Nordentoft, Dost O ̈ ngu ̈r, 

George C. Patton, Toma ́sˇ Paus, Ulrich Reininghaus, 

Akira Sawa, Michael Schoenbaum, Gunter 

Schumann, Vinod H. Srihari, Ezra Susser, Swapna 

K. Verma, T. Wilson Woo, Lawrence H. Yang, 

Alison R. Yung & Stephen J. Wood, Towards a 

Youth Mental Health Paradigm: A Perspective and 

Roadmap, Molecular Psychiatry 28, 3171–3181 

(2023). 

277SAMHSA, Key Substance Use and Mental 

Health Indicators in the United States: Results from 

the 2022 National Survey on Drug Use and Health 

(2023), https://www.samhsa.gov/data/sites/default/ 

files/reports/rpt42731/2022-nsduh-nnr.pdf. 

278Ronald C. Kessler, Patricia Berglund, Olga 

Demler, Robert Jin, Kathleen R. Merikangas, & Ellen 

E. Walters, Lifetime Prevalence and Age-of-Onset 

Distributions of DSM–IV Disorders in the National 

Comorbidity Survey Replication, 62(6) Arch Gen 

Psychiatry pp. 593–602 (2005). 

279Peter J. Uhlhaas, Christopher G. Davey, 

Urvakhsh Meherwan Mehta, Jai Shah, John Torous, 

Nicholas B. Allen, Shelli Avenevoli, Tolulope 

Bella-Awusah, Andrew Chanen, Eric Y.H. Chen, 

Christoph U. Correll, Kim Q. Do, Helen L. Fisher, 

Sophia Frangou, Ian B. Hickie, Matcheri S. 

Keshavan, Kerstin Konrad, Francis S. Lee, Cindy H. 

Liu, Beatriz Luna, Patrick D. McGorry, Andreas 

Meyer-Lindenberg, Merete Nordentoft, Dost O ̈ ngu ̈r, 

George C. Patton, Toma ́sˇ Paus, Ulrich Reininghaus, 

Akira Sawa, Michael Schoenbaum, Gunter 

Schumann, Vinod H. Srihari, Ezra Susser, Swapna 

K. Verma, T. Wilson Woo, Lawrence H. Yang, 

Alison R. Yung & Stephen J. Wood, Towards a 

Youth Mental Health Paradigm: A Perspective and 

Roadmap, Molecular Psychiatry 28, 3171–3181 

(2023). 

280 Kathleen Ries Merikangas, Jian-ping He, 

Marcy E. Burstein, Joel Swendsen, Shelli 

Avenevoli, Brady Case, Katholiki Georgiades, 

Leanne Heaton, Sonja Swanson, & Mark Olfson, 

Service Utilization for Lifetime Mental Disorders in 

U.S. Adolescents: Results of the National 

Comorbidity Survey Adolescent Supplement, 50(1) 

Journal of the American Academy of Child 

Adolescent Psychiatry, pp. 32–45 (2011), https://

www.ncbi.nlm.nih.gov/pmc/articles/PMC4408275. 

disorder care, the potential benefits 

could be significant. Using the suicide 

fatality rate for adults in 2021 from the 

Centers for Disease Control and 

Prevention (CDC) of approximately 14.1 

per 100,000 persons 259 and the 2020 

Agency for Healthcare Research and 

Quality youth suicide fatality rate of 

approximately 6.3 per 100,000,260 and 

applying these rates to the numbers of 

individuals 12 years old and older with 

private health insurance,261 suggests 

approximately 22,200 suicide deaths 

annually for adults 262 and 979 suicide 

deaths annually for children 12–17 

years old.263 For illustrative purposes, 

the Departments assume that these final 

rules would have roughly 40 percent of 

the impact of the Lang study, or a 2- 

percent reduction of fatalities.264 As 

such, the Departments estimate that the 

final rules could help prevent 444 

adult 265 and 20 youth 266 fatalities from 

suicide annually. Using the 2023 

estimate of the value of a statistical life 

(VSL) developed by the U.S. Department 

of Transportation (DOT), $13.2 

million,267 268 this would translate into 

benefits of $6.11 billion annually.269 270

The Departments recognize the 

uncertainty in the production of VSL 

benefit estimates. This uncertainty 

arises from a variety of assumptions that 

are key to the VSL estimate, such as the 

underlying demographic characteristics 

of the affected population or the 

differential willingness-to-pay for 

statistically equivalent but qualitatively 

different risks.271 To account for 

potential sensitivity arising from such 

uncertainty, the Departments have 

conducted a sensitivity analysis of these 

benefits and, following guidance on VSL 

sensitivity analysis,272 produced a lower 

and upper estimate of the VSL of 

approximately $5.3 million and $18.5 

million, respectively.273 Utilizing this 

range of estimates, the Departments 

accordingly estimate the value of the 

benefits of reduced mortality arising 

from increased mental health treatment 

utilization at between $2.5 billion and 

$8.6 billion annually.274

These benefits further illustrate the 

value of receiving treatment earlier and 

the harms of delaying treatment. While 

75 percent of mental illness onsets 

before age 25, individuals between age 

18 and 25 have a considerably higher 

prevalence of serious mental illness 275

than any other age group but the lowest 

rate of mental health treatment.276 277

Moreover, research suggesting that early 

symptom onset is associated with 

elevated risk for comorbid mental health 

disorders, as well as worsening health 

outcomes, illustrates the critical need 

for early mental health interventions 

and treatment access.278 279 However, 

the majority of adolescents with a 

mental health condition do not receive 

treatment.280 One review of recent 

changes in mental health treatment 

noted that ‘‘young people typically 

demonstrate a need for care prior to 

reaching the threshold for a traditional 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77673 

281Patrick D. McGorry & Christina Mei, Early 

Intervention in Youth Mental Health: Progress and 

Future Directions, 21(4) Evidence Based Mental 

Health pp. 182–184 (2018). 

282 Ibid. 

283National Institute of Health and Care 

Excellence, Glossary, https://www.nice.org.uk/ 

glossary. 

284Boshen Jiao, Zohn Rosen, Martine Bellanger, 

Gary Belkin, & Peter Muennig, The CostEffectiveness of PHQ Screening and Collaborative 

Care for Depression in New York City, PLoS One 

12(8):e0184210 (Aug. 31, 2017), https://pubmed.

ncbi.nlm.nih.gov/28859154/. 

285Saadia Sediqzadah, Allison Portnoy, Jane J. 

Kim, Matcheri Keshavan, & Ankur Pandya, CostEffectiveness of Early Intervention in Psychosis: A 

Modeling Study, 73(9) Psychiatric Services pp. 961– 

1080 (2022). 

286Constance M. Horgan, Dominic Hodgkin, 

Maureen T. Stewart, Amity Quinn, Elizabeth L. 

Merrick, Sharon Reif, Deborah W. Garnick, & 

Timothy B. Creedon, Health Plans Early Response 

to Federal Parity Legislation for Mental Health and 

Addiction Services, 62(2) Psychiatric Services pp. 

162–168 (2016). 

287SAMHSA, Center for Behavioral Health 

Statistics and Quality, National Survey on Drug Use 

and Health, 2021 and 2022, https://

www.samhsa.gov/data/data-we-collect/nsduhnational-survey-drug-use-and-health. 

288Sarah Friedman, Haiyong Xu, Jessica M. 

Harwood, Francisca Azocar, Brian Hurley, & Susan 

L. Ettner, The Mental Health Parity and Addiction 

Equity Act Evaluation Study: Impact on Specialty 

Behavioral Healthcare Utilization and Spending 

Among Enrollees with Substance Use Disorders, 80 

Journal of Substance Abuse Treatment pp. 67–78 

(2017). 

289This estimate of a 7 percent reduction is based 

on the estimate of 17 percent previously cited, 

revised downward by 60 percent to account for the 

indirect impact of expanded parity associated with 

these final rules. See Sarah Friedman, Haiyong Xu, 

Jessica M. Harwood, Francisca Azocar, Brian 

Hurley, & Susan L. Ettner, The Mental Health Parity 

and Addiction Equity Act Evaluation Study: Impact 

on Specialty Behavioral Healthcare Utilization and 

Spending Among Enrollees with Substance Use 

Disorders, 80 Journal of Substance Abuse Treatment 

pp. 67–78 (2017). 

290This estimate is calculated as follows: 

157,443,601 adult participants with private health 

insurance × 1.4 percent indicate OUD in past year 

= 2,125,489 adults with private health insurance 

and OUD. Then, 2,125,489 × 29 percent receiving 

treatment = 616,817 adults with OUD and private 

health insurance receiving treatment annually. 

Lastly, 616,817 × 6.98 percent increase in adults 

with private health insurance receiving treatment = 

43,054 additional adults receiving treatment for 

OUD annually. 

291SAMHSA, Medications for Opioid Use 

Disorder: For Healthcare and Addiction 

Professionals, Policymakers, Patients, and Families 

(2021), https://store.samhsa.gov/sites/default/files/ 

pep21-02-01-002.pdf. 

292National Academies of Sciences, Engineering, 

and Medicine, Medications for Opioid Use Disorder 

Save Lives (2019), Washington, DC: The National 

Academies Press. 

293Nisha Nataraj, S. Michaela Rikard, Kun Zhang, 

Xinyi Jiang, Gery P. Guy Jr, Ketra Rice, Christine L. 

Mattson, R. Matthew Gladden, Desiree M. 

Mustaquim, Zachary N. Illg, Puja Seth, Rita K. 

Noonan, & Jan L. Losby, Public Health Interventions 

and Overdose-Related Outcomes Among Persons 

with Opioid Use Disorder, 7(4) JAMA Network 

Open (2024). 

294Nora D. Volkow, Thomas R. Frieden, Pamela 

S. Hyde, & Stephen S. Cha, Medication-Assisted 

Therapies—Tackling the Opioid Overdose 

Epidemic, 370(22) New England Journal of 

Medicine (2014), https://www.nejm.org/doi/full/ 

10.1056/NEJMp1402780. 

295Robert P. Schwartz, Jan Gryczynski, Kevin E. 

O’Grady, Joshua M. Sharfstein, Gregory Warren, 

Yngvild Olsen, Shannon G. Mitchell, & Jerome H. 

Jaffe, Opioid Agonist Treatments and Heroin 

Overdose Deaths in Baltimore, Maryland, 1995– 

2009, 103(5) American Journal of Public Health pp. 

917–922 (2013), https://www.ncbi.nlm.nih.gov/ 

pmc/articles/PMC3670653. 

296SAMHSA, TIPS 63: Medications for Opioid 

Use Disorder (2021), https://store.samhsa.gov/sites/ 

default/files/pep21-02-01-002.pdf. 

297National Academies of Sciences, Engineering, 

and Medicine, Medications for Opioid Use Disorder 

Save Lives, Washington, DC: The National 

Academies Press (2019), https://doi.org/10.17226/ 

25310. 

298 Jill A. Dever, Marci F. Hertz, Laura J. Dunlap, 

John S. Richardson, Sara Beth Wolicki, Bradley B. 

Biggers, Mark J. Edlund, Michele K. Bohm, Didier 

Turcios, Xinyi Jiang, Hong Zhou, Mary E. Evans, 

Gery P. Guy, Jr., The Medications for Opioid Use 

Disorder Study: Methods and Initial Outcomes from 

an 18-Month Study of Patients in Treatment for 

Opioid Use Disorder, Public Health Reports pp. 1– 

10 (2024), https://pubmed.ncbi.nlm.nih.gov/ 

38268479/. 

299Robert Heimer, Anne C. Black, Hsiuju Lin, 

Lauretta E. Grau, David A. Fiellin, Benjamin A. 

Howell, Kathryn Hawk, Gail D’Onofrio, & William 

C. Becker, Receipt of Opioid Use Disorder 

Treatment Prior to Fatal Overdoses and 

Continued 

major psychiatric diagnosis where 

distress, functional impairment and 

warning signs . . . of mental illness are 

present, making early intervention at 

this time point crucial to preventing or 

reducing the severity of a full-threshold 

disorder.’’ 281 Further, this review noted 

that early intervention is key for 

reducing ‘‘premature death, social 

isolation, poor functioning and reduced 

educational and vocational 

productivity.’’ In recent years, research 

has driven an increased interest in early 

intervention services for younger 

individuals.282

Mental health research often evaluates 

the benefits of mental health care in 

terms of a quality-adjusted life year 

(QALY), an assessment metric that 

evaluates the changes to a person’s 

quality of life arising from an 

intervention. According to the National 

Institute for Health and Care Excellence, 

one QALY ‘‘is equal to 1 year of life in 

perfect health.’’ 283 In 2015 New York 

City launched a program called 

ThriveNYC, which included 54 

initiatives to improve mental health, 

including additional screening and 

collaborative care. The study found that, 

on average, a 20-year-old who received 

these interventions would see an 

increase of 0.38 QALYs (representing a 

change in quality of life, with no 

estimation in this study of changes to 

length of life) relative to those who did 

not receive these interventions.284

Another study compared the cost 

effectiveness of early intervention to 

standard care for the treatment of firstepisode psychosis, finding that from a 

societal perspective (that is, quality of 

life, educational attainment, and gainful 

employment), early intervention 

resulted in higher discounted QALYs 

and lower costs than standard care. 

While acknowledging that earlier 

interventions result in higher lifetime 

costs than the standard care perspective, 

the authors still found early 

intervention to be cost effective.285

The Departments do not anticipate the 

benefits to be exclusive to prevented 

suicides. The final rules are also 

expected to increase access to and 

utilization of behavioral health services 

and substance use disorder services.286

The 2022 NSDUH from SAMHSA 

indicates that 1.4 percent of adults with 

private health insurance reported 

having an OUD in the past year, while 

only 29 percent of those individuals 

indicated receiving treatment for OUD 

in the same year.287 A 2017 study 

utilizing claims and eligibility data from 

nearly 6 million enrollees found that 

parity resulted in a 17 percent increase 

in use of OUD treatment services, which 

illustrates a strong, positive relationship 

between parity and the utilization of 

behavioral health services.288 As 

discussed in section IV.6.1.3, there have 

been findings of positive or no impact 

of MHPAEA on the utilization of mental 

health and substance use disorder 

services. For illustrative purposes, the 

Departments assume that these final 

rules would have roughly 40 percent of 

the impact of the 2017 study, or an 

approximately 7 percent increase in 

OUD treatment service utilization.289

This would result in approximately 

43,000 additional individuals receiving 

OUD treatment each year.290

Considerable research has demonstrated 

the efficacy of treatment for 

OUD,291 292 293 294 295 296 297 including 

several recent studies that have 

observed the reduction of both fatal and 

non-fatal overdoses for people 

diagnosed with OUD after receiving 

treatment. For example, an 18-month 

observational study of multiple cohorts 

of people receiving OUD treatments 

across the United States between 2017 

and 2021 found that following 

outpatient treatment for OUD, the 

number of patient overdoses, arrests, 

and drug-related hospitalizations were 

all reduced by over 50 percent.298

Similarly, a 2024 retrospective study of 

opioid overdose fatalities found that 

individuals who recently received 

treatment for OUD experienced 

approximately 34 percent to 38 percent 

fewer overdose deaths compared to 

those who did not receive treatment.299


khammond on DSKJM1Z7X2PROD with RULES2
77674 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

Comparison to No Treatment in Connecticut, 2016– 

2017, Drug and Alcohol Dependence (2024), https:// 

pubmed.ncbi.nlm.nih.gov/38043226/. 

300The Departments averaged the reduction in 

overdoses arising from four treatment outcomes 

against the baseline of no treatment: MedicatedAssisted Treatment (MAT) only, MAT in addition 

to Contingency Management (CM), MAT in addition 

to Psychotherapy (PT), as well as MAT in addition 

to both CM and PT. (See Michael Fairley, Keith 

Humphreys, Vilija R. Joyce, Mark Bounthavong, 

Jodie Trafton, Ann Combs, Elizabeth M. Oliva, 

Jeremy D. Goldhaber-Fiebert, Steven M. Asch, 

Margaret L. Brandeau, & Douglas K. Owens, CostEffectiveness of Treatments for Opioid Use 

Disorder, 78(7) JAMA Psychiatry pp. 767–777 

(2021), https://pubmed.ncbi.nlm.nih.gov/33787832/ 

.) 

301Outcomes related to overdose education and 

naloxone distribution were not used in estimating 

the impacts of OUD treatment in the final rule, as 

naloxone is a common over-the-counter product not 

intended to treat OUD, but rather reverse an opioid 

overdose. While it may help to reduce overdoses 

and OUD-related fatalities, it is not a ‘‘treatment’’ 

per se and as such, is not considered when 

estimating the benefits of treatment. 

302This estimate is calculated as follows: 43,054 

additional adults receiving treatment for OUD × 

(10,860 per 100,000 non-fatal overdose rate for 

those with OUD) = 4,676 non-fatal overdoses. 4,676 

non-fatal overdoses × 15.6 percent reduction = 730 

non-fatal overdoses prevented. 

303The Departments utilized the nonfatal 

overdose rate calculated for 2023 to produce these 

estimates. Specifically, this calculation was derived 

from the data supplement, eTable 9, as (1,927,706 

non-fatal overdoses in 2023 ÷ (16,072,360 

individuals with OUD in 2023 + 1,677,988 

individuals receiving medication for OUD)) × 

100,000 = 10,860 per 100,000 non-fatal overdose 

rate for those with OUD. (See Nisha S. Nataraj, 

Michaela Rikard, Kun Zhang, Xinyi Jiang, Gery P. 

Guy, Ketra Rice, Christine L. Mattson, Matthew 

Gladden, Desiree M. Mustaquim, Zachary N. Illg, 

Puja Seth, Rita K. Noonan, & Jan L. Losby, Public 

Health Interventions and Overdose-Related 

Outcomes Among Persons with Opioid Use 

Disorder, Supplement 1, eTable 9, 7(4) Substance 

Use and Addiction (2024).) 

304Non-medical costs of non-fatal overdoses are 

derived from work loss costs and monetized 

quality-adjusted life loss per injury. Medical costs 

of non-fatal overdoses are derived from healthcare 

provider payments that include inpatient, 

outpatient, and outpatient drug costs. 

305Cora Peterson, Ketra L. Rice, Dionne D. 

Williams, & Robert Thomas, WISQARS Cost of 

Injury for Public Health Research and Practice, 

29(2) Injury Prevention (Nov. 2022). 

306The average cost of non-fatal overdose 

requiring hospitalization = $19,256 average 

associated QALY non-medical cost per 

hospitalization + $33,026 average associated 

medical cost per hospitalization = $52,282 per nonfatal overdose hospitalization. The average cost of 

non-fatal overdose requiring only treatment and 

release = $3,254 average associated QALY nonmedical cost per treatment and release + $9,614 

associated medical cost per treatment and release = 

$12,868 per non-fatal overdose requiring only 

treatment and release. (See Cora Peterson, Ketra L. 

Rice, Dionne D. Williams, & Robert Thomas, 

WISQARS Cost of Injury for Public Health Research 

and Practice, 29(2) Injury Prevention (Nov. 2022). 

307The estimate is calculated as follows: 730 nonfatal overdoses prevented × 24.36 percent overdose 

hospitalization rate = 178 non-fatal overdose 

hospitalizations prevented. $52,282 per non-fatal 

overdose hospitalization × 178 non-fatal overdose 

hospitalizations prevented = $9,304,598. 

Additionally, 730 non-fatal overdoses × 75.64 

percent overdose treatment and release rate = 552 

non-fatal overdose treatment and releases 

prevented. $12,868 per non-fatal overdose requiring 

treatment and release × 552 non-fatal overdoses 

requiring treatment and release = $7,109,073. As 

such, the total benefit estimate related to non-fatal 

overdoses is calculated as: $9,304,598 + $7,109,073 

= $16,413,761. 

308Elizabeth Evans, Libo Li, Jeong Min, David 

Huang, Darren Urada, Lei Liu, Yih-Ing Hser, & 

Bohdan Nosyk, Mortality Among Individuals 

Accessing Pharmacological Treatment for Opioid 

Dependence in California, 2006–2010, Addiction 

110(6): 996–1005 (June 2015). 

309Marc Larochelle, Dana Bernson, Thomas Land, 

Thomas Stopka, Na Wang, Ziming Xuan, Sarah 

Bagley, Jane Liebschutz, Alexander Walley, 

Medication for Opioid Use Disorder After Nonfatal 

Opioid Overdose and Association with Mortality: A 

Cohort Study, Ann Intern Med 169(3): 137–145 

(2018), https://pubmed.ncbi.nlm.nih.gov/ 

29913516/. 

310 Yih-Ing Hser, Larissa J. Mooney, Andrew J. 

Saxon, Karen Miotto, Douglas S. Bell, Yuhui Zhu, 

Di Liang, and David Huang, High Mortality among 

Patients with Opioid Use Disorder in a Large 

Healthcare System, J Addict Med 11(4): 315–319 

(2017), https://www.ncbi.nlm.nih.gov/pmc/articles/ 

PMC5930020/. 

311The reduction in all-cause mortality was 

calculated as the change in the crude mortality rate 

per 100 person-years from 1.94 (for those not 

receiving any treatment) to 1.27 (for those receiving 

either MOUD treatment, inpatient treatment, or 

both). Thus, the percentage change in the rates from 

1.94 per 100 person-years to 1.27 per 100 personyears is approximately 35 percent. 

312Alexander Walley, Sara Lodi, Yijing Li, Dana 

Bernson, Hermik Babakhanlou-Chase, Thomas 

Land, & Marc R. Larochelle, Association Between 

Mortality Rates and Medication and Residential 

Treatment After Inpatient Medically Managed 

Opioid Withdrawal: A Cohort Analysis, 115(8) 

Addiction pp. 1496–1508 (Aug. 2020). 

313Marc Larochelle, Dana Bernson, Thomas Land, 

Thomas Stopka, Na Wang, Ziming Xuan, Sarah 

Bagley, Jane Liebschutz, Alexander Walley, 

Medication for Opioid Use Disorder After Nonfatal 

Opioid Overdose and Association with Mortality: A 

Cohort Study, Ann Intern Med 169(3): 137–145 

(2018), https://pubmed.ncbi.nlm.nih.gov/ 

29913516/. 

314 Yih-Ing Hser, Larissa J. Mooney, Andrew J. 

Saxon, Karen Miotto, Douglas S. Bell, Yuhui Zhu, 

Di Liang, and David Huang, High Mortality among 

Patients with Opioid Use Disorder in a Large 

Healthcare System, J Addict Med 11(4): 315–319 

A 2021 study funded by the National 

Institute on Drug Abuse (NIDA) found 

that, across a nationally representative 

cohort of individuals with OUD, 

common treatments for OUD were 

associated with a reduction in the 

number of overdoses by 11 to 21 

percent, with an average reduction of 16 

percent across all treatment types.300

This study assessed the effects of all 

three FDA-approved medications for 

OUD in various combinations with and 

without the most common treatments 

(psychotherapy, contingency 

management, and overdose education 

and naloxone distribution).301 Utilizing 

life tables, clinical data, and relevant 

literature on treatment outcomes, the 

study produced a dynamic 

compartmental model to analyze the 

effects of medications and treatments on 

overdoses and mortality. While it is 

limited by the scope and availability of 

relevant secondary data, the model 

employs parameters, robustness checks, 

and sensitivity analysis that sufficiently 

validate the empirical model. 

To illustrate the potential impact of 

these final rules, the Departments 

employ this lower estimate of a 16 

percent reduction in overdoses 

following treatment, and estimate that 

increased treatment for expanded OUD 

access and utilization could result in the 

prevention of approximately 730 nonfatal overdoses each year.302 303 Utilizing 

data from the CDC estimating the 

average medical and non-medical cost 

of non-fatal overdoses,304 the 

Departments estimate the benefits of 

these reduced non-fatal overdoses at 

$16.4 million annually.305 306 307

The benefits of individuals diagnosed 

with an OUD receiving treatment may 

go beyond the benefit of reduced harms 

from overdoses. Mortality data of 

individuals diagnosed with an OUD 

indicate overdoses comprise 

approximately half of fatalities for such 

individuals, who are increasingly at risk 

of death from infectious disease, 

common co-morbid conditions such as 

liver or heart disease, accidental deaths, 

suicide, and other physical traumas.308

Research indicates that individuals with 

an OUD that are receiving treatment, 

while still at increased risk from allcause mortality compared to the general 

population, may experience a reduced 

risk of mortality after receiving 

treatment for their OUD condition.309 310

One study found that mortality rates 

were 35 percent lower for individuals 

that received treatment for OUD than for 

those who did not receive 

treatment.311 312 This retrospective 

cohort study used expansive, linked 

public health, medical, and vital 

statistics data from a single State to 

establish a robust population cohort of 

individuals with OUD for which 

mortality was the observed outcome 

over approximately 45,000 person-years 

following an initial detox episode. 

While a potential limitation of 

observational studies is the presence of 

confounding variables distorting 

measured outcomes, the breadth of the 

data being utilized, which included data 

from insurance claims and extensive 

medical histories, limit this concern. 

The findings of the study, indicating a 

high all-cause and overdose-related 

mortality rate for individuals with OUD 

and resultant decline following 

treatment, are consistent with other 

research findings and, as an 

observational cohort study, represent a 

high level of evidence.313 314


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77675 

(2017), https://www.ncbi.nlm.nih.gov/pmc/articles/ 

PMC5930020/. 

315This estimate is calculated as: 43,054 

additional beneficiaries receiving treatment for 

OUD × 4.70 crude mortality rate per 100 personyears for OUD = 2,024 expected fatalities in the 

absence of treatment. Adjusting the crude mortality 

rate downward 34.7 percent to 3.07 following 

treatment for this group, the expected fatalities 

would be estimated as 43,054 additional 

beneficiaries receiving treatment for OUD × 3.07 

crude mortality rate per 100 person-years for OUD 

= 1,322 expected fatalities following treatment. As 

such, the Departments estimate the prevented 

fatalities from all causes arising from OUD 

treatment to be: 2,024¥1,322 = 702 prevented 

fatalities. 

316This estimate is calculated as: the value of a 

statistical life of $13,200,000 × 702 prevented 

fatalities = $9,269,545,489. 

317 Individuals express a different willingness to 

pay to reduce the fatality risk of some deaths (those 

with a perceived associated morbidity, such as 

cancer) more than others (such as car accidents), 

though the risks may be equivalent. DOT guidance 

on the VSL suggests utilizing a single, nationwide 

value that does not adjust the VSL based on the 

nature of the risk or the underlying characteristics 

of the affected population but encourages a 

sensitivity analysis to reflect such uncertainty. 

318For more information on the VSL guidance 

utilized, see The DOT’s Revised Departmental 

Guidance on Valuation of a Statistical Life in 

Economic Analysis, https://

www.transportation.gov/office-policy/ 

transportation-policy/revised-departmentalguidance-on-valuation-of-a-statistical-life-ineconomic-analysis. 

319The lower and upper bounds are estimated as 

40 percent below and above the central estimate of 

$13,200,000, per DOT guidance on conducting a 

sensitivity analysis for a VSL estimate. 

320These estimates are calculated as: The lower 

VSL estimate of $5,280,000 × 702 fatalities 

prevented = $3,707,818,196. The lower VSL 

estimate of $18,480,000 × 702 fatalities prevented 

= $12,977,363,685. 

321SAMHSA, Key Substance Use and Mental 

Health Indicators in the United States: Results from 

the 2022 National Survey on Drug Use and Health 

(Nov. 2023), https://www.samhsa.gov/data/sites/ 

default/files/reports/rpt42731/2022-nsduh-nnr.pdf. 

322Beth Han, Wilson Compton, Carlos Blanco, & 

Lisa Colpe, Prevalence, Treatment, and Unmet 

Treatment Needs of US Adults with Mental Health 

and Substance Use Disorders, 36(10) Health Affairs 

pp. 1739–1747 (2017), https://www.health

affairs.org/doi/epdf/10.1377/hlthaff.2017.0584. 

323Benjamin Druss & Elizabeth Walker, Mental 

Disorders and Medical Comorbidity, Research 

Synthesis Report No. 21, Robert Wood Johnson 

Foundation (Feb. 2011), https://up2riverside.org/ 

wp-content/uploads/2024/04/medical

comorbidity.pdf. 

324Elizabeth C. Verna, Aaron Schluger, & Robert 

S. Brown Jr., Opioid Epidemic and Liver Disease, 

1(3) JHEP Report pp. 240–255 (Sept. 2019), https:// 

www.ncbi.nlm.nih.gov/pmc/articles/PMC7001546/ 

pdf/main.pdf. 

325T. Jake Liang & John W. Ward, Hepatitis C in 

Injection-Drug Users—A Hidden Danger of the 

Opioid Epidemic, 378(13) New England Journal of 

Medicine pp. 1169–1171 (Mar. 2018), https://

www.ncbi.nlm.nih.gov/pmc/articles/PMC5993680/ 

pdf/nihms972424.pdf. 

326Alain K. Koyama, A. Hora, Kai McKeever 

Bullard, Stephen R. Benoit, Shichao Tang, & Pyone 

Cho, State-Specific Prevalence of Depression 

Among Adults With and Without Diabetes—United 

States, 2011–2019, 20(70) Preventing Chronic 

Disease (Aug. 2023), https://www.cdc.gov/pcd/ 

issues/2023/pdf/22_0407.pdf. 

327United Nations Office on Drugs and Crime, 

Comorbidities in Drug Use Disorders (Mar. 2022), 

https://www.unodc.org/documents/drugprevention-and-treatment/UNODC_Comorbidities_

in_drug_use_disorders.pdf. 

328National Institute on Drug Abuse, Common 

Comorbidities with Substance Use Disorders 

Research Report (Apr. 2020), https://

www.ncbi.nlm.nih.gov/books/NBK571451/. 

329Stephen Magura, Andrew Rosenblum, & 

Chunki Fong, Factors Associated with medication 

Adherence among Psychiatric Outpatients at 

Substance Abuse Risk, Open Addict J. (4), 58–64 

(Nov. 2011), https://www.ncbi.nlm.nih.gov/pmc/ 

articles/PMC3526017/. 

330Pamela Owens, Lan Liang, Marguerite Barrett, 

and Kathryn Fingar, Comorbidities Associated with 

Adult Inpatient Stays, 2019. Agency for Healthcare 

Research and Quality, Healthcare Cost and 

Utilization Project, Statistical Brief #303 (Dec. 

2022). 

331Pamela Owens, Lan Liang, Marguerite Barrett, 

and Kathryn Fingar, Comorbidities Associated with 

Adult Inpatient Stays, 2019. Agency for Healthcare 

Research and Quality, Healthcare Cost and 

Utilization Project, Statistical Brief #303 (Dec. 

2022). 

332United Nations Office on Drugs and Crime, 

Comorbidities in Drug Use Disorders (Mar. 2022), 

https://www.unodc.org/documents/drugprevention-andtreatment/UNODC_Comorbidities_

in_drug_use_disorders.pdf. 

333Wayne Katon, Joan Russo, Elizabeth H.B. Lin, 

Julie Schmittdiel, Paul Ciechanowski, Evette 

Ludman, Do Peterson, Bessie Young, & Michael Von 

Korff, Cost-Effectiveness of a Multi-Condition 

Collaborative Care Intervention: A Randomized 

Controlled Trial, 69(5) Archives of General 

Psychiatry (May 2012), https://www.ncbi.nlm.

nih.gov/pmc/articles/PMC3840955/pdf/ 

nihms521136.pdf. 

Employing this estimate of an 

approximately 35 percent reduction in 

fatalities following treatment to 

illustrate the potential impact of these 

final rules, the Departments estimate 

that increased treatment for expanded 

OUD access and utilization could result 

in the prevention of approximately 702 

fatalities from all causes in persons 

receiving treatment for OUD each 

year.315 The Departments have utilized 

the VSL, as with their estimate of the 

value of prevented suicides, to estimate 

the benefits of reduced mortality arising 

from increased OUD treatment 

utilization at $9.3 billion annually.316

As discussed earlier in this section, the 

Departments recognize some 

uncertainty in the production of VSL 

benefit estimates.317 To account for 

potential sensitivity arising from such 

uncertainty, the Departments have 

conducted a sensitivity analysis of these 

benefits and, following guidance on VSL 

sensitivity analysis,318 produced a lower 

and upper estimate of the VSL of 

approximately $5.3 million and $18.5 

million, respectively.319 Utilizing this 

range of estimates, the Departments 

accordingly estimate the value of the 

benefits of reduced mortality arising 

from increased OUD treatment 

utilization at between $3.7 billion and 

$13.0 billion annually.320

Mental health and substance use 

disorders do not always occur in 

isolation, but are commonly cooccurring conditions, as individuals 

with substance use disorders are more 

likely to experience a mental health 

condition than the general population 

and nearly half of adults with serious 

mental illness also have a substance use 

disorder.321 Such co-occurring 

conditions can significantly exacerbate 

the severity of symptoms as well as 

negative health outcomes related to 

these conditions.322 Additionally, 

individuals with mental health 

conditions and substance use disorders 

are known to commonly experience 

physical co-morbidities that can 

significantly impact overall health and 

quality of life. A 2011 study indicated 

that over 68 percent of adults with a 

mental health disorder reported a 

comorbid medical disorder while 29 

percent indicated they had another 

comorbid mental health condition.323

Human immunodeficiency virus (HIV), 

hepatitis, and diabetes are all more 

prevalent among those with substance 

use disorders or mental health 

conditions than the general population, 

while such physical or other mental 

comorbid conditions are more likely to 

be adversely impacted by poor disease 

management and treatment adherence 

when co-occurring with a mental health 

condition or substance use 

disorder.324 325 326 327 328 329 A 2022 study 

observing the presence of comorbid 

conditions for inpatient hospitalizations 

found that 81 percent of hospitalizations 

for a mental health condition or 

substance use disorder had a co-morbid 

condition.330 The study also found that 

co-morbid conditions were associated 

with a longer hospitalization period, a 

higher cost per hospitalization, as well 

as increased mortality during 

hospitalization.331

As mental health conditions and 

substance use disorders can make 

preventing, managing, and treating 

physical comorbidities difficult, 

improvements in mental health and 

substance use disorder outcomes may 

also improve overall physical health 

outcomes and lower healthcare costs for 

participants.332 333 Data from Evernorth 

Health Services, a subsidiary of Cigna, 

indicates that accessing mental health 

and substance use disorder services can 

result in considerable cost savings for 

patients diagnosed with a mental health 

condition and substance use disorder 

concern, producing a reported cost 

savings of between $1,134 to $3,321 per 

person over the first 27 months 


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77676 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

334Evernorth Health Services, Behavioral Health 

Care Significantly Lowers Medical Care Costs (Jan. 

2023), https://www.evernorth.com/behavioralhealth-study. 

335Wayne Katon, Joan Russo, Elizabeth H.B. Lin, 

Julie Schmittdiel, Paul Ciechanowski, Evette 

Ludman, Do Peterson, Bessie Young, & Michael Von 

Korff, Cost-Effectiveness of a Multi-Condition 

Collaborative Care Intervention: A Randomized 

Controlled Trial, 69(5) Archives of General 

Psychiatry (May 2012), https://www.ncbi.nlm.

nih.gov/pmc/articles/PMC3840955/pdf/ 

nihms521136.pdf. 

336SAMHSA, Key Substance Use and Mental 

Health Indicators in the United States: Results from 

the 2022 National Survey on Drug Use and Health, 

Figure 62, p. 61 (Nov. 2023), https://

www.samhsa.gov/data/sites/default/files/reports/ 

rpt42731/2022-nsduh-nnr.pdf. 

337SAMHSA, Key Substance Use and Mental 

Health Indicators in the United States: Results from 

the 2022 National Survey on Drug Use and Health, 

Figures 54 and 55, pp. 50–51 (Nov. 2023). https:// 

www.samhsa.gov/data/sites/default/files/reports/ 

rpt42731/2022-nsduh-nnr.pdf. 

338National Council for Mental Wellbeing, 2022 

Access to Care Survey Results (May 11, 2022), 

https://www.thenationalcouncil.org/wp-content/

uploads/2022/05/2022-Access-To-Care-SurveyResults.pdf. 

339Paul E. Greenberg, Andree-Anne Fournier, 

Tammy Sisitsky, Mark Simes, Richard Berman, 

Sarah H. Koenigsberg, & Ronald C. Kessler, The 

Economic Burden of Adults with Major Depressive 

Disorder in the United States (2010 and 2018), 39(6) 

Pharmacoeconomics pp. 653–665 (2021). 

340Martin Andersen, Heterogeneity and the Effect 

of Mental Health Parity Mandates on the Labor 

Market, 43 Journal of Health Economics (2015). 

341The study defined ‘‘presenteeism’’ as 

‘‘decreased productivity at work.’’ 

342Claire de Oliveira, Makeila Saka, Lauren Bone, 

& Rowena Jacobs, The Role of Mental Health on 

Workplace Productivity: A Critical Review of the 

Literature, 21(2) Applied Health Economics and 

Health Policy pp. 167–193 (2023). 

343Caroline Margiotta, Jessica Gao, So O’Neil, 

Divya Vohra, & Kara Zivin, The Economic Impact 

of Untreated Maternal Mental Health Conditions in 

Texas, 22(700) BMC Pregnancy Childbirth (2022). 

344 Isabel Platt, Emma Pendl-Robinson, Eric 

Dehus, So O’Neil, Divya Vohra, Kara Zivin, Michael 

Kenny & Laura Pentenrieder, Estimating the Costs 

of Untreated Perinatal Mood and Anxiety Disorders 

in Vermont, Mathematica (May 2023), https://

www.mathematica.org/publications/societal-costsof-perinatal-mood-and-anxiety-disorders-invermont. 

345 Dan Witters & Sangeeta Agrawal, The 

Economic Cost of Poor Employee Mental Health, 

Gallup Workplace (Dec. 13, 2022), https://

www.gallup.com/workplace/404174/economic-costpoor-employee-mental-health.aspx?version=print. 

346 Donghoon Lee, Yeonil Kim, & Beth Devine, 

Spillover Effects of Mental Health Disorders on 

Family Members’ Health-related Quality of Life: 

Evidence from a US Sample, 42(1) Medical 

Decision Making pp. 80–93 (2022). 

347Curtis Florence, Feijun Luo, & Ketra Rice, The 

Economic Burden of Opioid Use Disorder and Fatal 

following diagnosis.334 Similarly, a 2012 

study of patients with a mental health 

condition and comorbid physical health 

condition found that treating the 

underlying mental health condition 

yielded significant improvements in the 

comorbid physical conditions, resulting 

in increased positive health outcomes 

and lower long-term healthcare costs.335

The Departments, in evaluating the 

impacts of these final rules, anticipate 

that, by prohibiting inequitable barriers 

to coverage, the estimated 

improvements in mental health 

conditions and substance use disorders 

will help reduce the severity of 

comorbid conditions, improve related 

health outcomes for participants, 

beneficiaries, and enrollees, and as 

such, represent a substantial, but 

potentially unquantified, benefit. 

7.4. Reduced Adverse Impacts on the 

Families, Friends, Caregivers, and 

Coworkers of People Who Suffer From 

Untreated or Poorly Managed Mental 

Health Conditions and Substance Use 

Disorders 

These final rules will help employees, 

caregivers and their families meet their 

mental health and substance use 

disorder care needs, and thus, may 

improve the productivity and resulting 

earnings of workers dealing with mental 

health conditions and substance use 

disorder. Among adults with any mental 

health condition in 2022, only 50.6 

percent received treatment.336

Moreover, while 19.4 percent of NSDUH 

respondents 12 and older were 

classified as needing substance use 

disorder treatment in 2022, only 4.6 

percent of respondents 12 and older 

indicated that they received treatment 

that year.337 One survey found that 

more than 85 percent of individuals that 

did not receive their needed mental 

health or substance use care reported 

negative impacts, including personal 

relationship issues, job issues and 

performing poorly or dropping out of 

school.338

The economic impact of untreated 

mental health conditions and substance 

use disorders can be significant. A 2021 

study of claims data for large, selffunded health plans looked at the 

economic burden attributable to major 

depressive disorder, including the direct 

costs associated with treatment, suiciderelated costs, and workplace costs, 

between 2010 and 2018. During that 

period, overall economic burden of 

adults with a major depressive disorder 

increased 37.9 percent (from $236.6 

billion to $326.2 billion). While part of 

the cost increase can be attributed to a 

12.9 percent increase in the number of 

adults with major depressive disorders, 

direct costs became a smaller share of 

the total costs, with workplaces costs, 

defined as missed work (due to injury/ 

illness, discretionary time off and 

disability) and lower productivity while 

at work, constituting 61 percent of the 

costs in 2018 and increasing from $48.3 

billion in 2010 to $70.8 billion in 

2018.339 A 2015 study examined the 

impact of State parity laws on 

individuals with moderate levels of 

mental distress and found that State 

parity laws were associated with an 

increase in overall employment, weekly 

wages, and the number of hours worked 

per week, and attributed these changes 

to the increased productivity of these 

workers.340 A 2023 study critically 

reviewed 38 studies on the relationship 

between mental health and lost 

productivity, and found that poor 

mental health was associated with 

increased presenteeism 341 and 

absenteeism.342

These final rules will also have 

significant indirect impacts on families, 

friends, caregivers, and coworkers with 

untreated or poorly managed mental 

health conditions and substance use 

disorders, as well as society at large. By 

prohibiting inequitable barriers to 

coverage and thereby increasing access 

to mental health and substance use 

disorder services, these final rules will 

lead to more people receiving treatment, 

reducing the burden on family members 

and other support systems. For example, 

this includes untreated maternal mental 

health conditions, which can lead to a 

reduced ability to work, increased risk 

of suicide, increased use of public 

services, and worse maternal and child 

health. A 2022 study of the cost of 

maternal mental health conditions to 

Texas women and their children 

projected costs for the 2019 birth cohort 

from the time of conception through 5 

years postpartum to total $2.2 billion.343

Untreated maternal mental health 

conditions include untreated perinatal 

mood and anxiety disorders, which 

have been found to account for 

approximately $48 million in societal 

costs in Vermont for the average annual 

birth cohort from conception through 5 

years postpartum, including $12.5 

million in productivity loss and $9.4 

million in non-obstetric health 

expenditures.344

The cost in missed productivity for 

workers with fair or poor mental health 

due to unplanned absences was 

estimated as $47.6 billion annually in 

2022.345 A 2022 study found that 

households with a family member 

diagnosed with a mental health disorder 

had lower health status scores compared 

to households without a mental illness 

diagnosis, suggesting evidence of family 

spillover effects on mental illness.346

Finally, a 2021 study estimated that the 

societal costs of untreated OUD was 

approximately $1.02 trillion in 2017, 

which includes $35 billion in health 

care costs and $92 billion in lost 

productivity.347


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Opioid Overdose in the United States, 2017, 218 

Drug and Alcohol Dependence (2021). 

These final rules are expected to 

improve access to and utilization of 

mental health and substance use 

disorder services by removing barriers 

to access to mental health and substance 

use disorder benefits caused by NQTLs. 

By enhancing treatment for these 

conditions and disorders, these final 

rules will likely result in reduced 

productivity loss or missed workdays 

for individuals suffering from mental 

health conditions or substance use 

disorders. Furthermore, the improved 

management and treatment of these 

conditions and disorders will 

potentially lead to reduced adverse 

impacts on the families, friends, and 

coworkers of those affected, as untreated 

or poorly managed mental health 

conditions and substance use disorders 

can have significant spillover effects on 

an individual’s personal and 

professional lives. 

8. Costs 

These final rules aim to promote 

access to mental health and substance 

use disorder benefits by clarifying how 

plans and issuers must ensure that their 

plans and coverage are designed, as 

written and in operation, to comply 

with MHPAEA’s parity requirements for 

mental health and substance use 

disorder benefits and medical/surgical 

benefits, and allowing them to more 

easily identify changes needed to bring 

their plans and coverage into 

compliance. The Departments 

acknowledge that plans and issuers, in 

revising their approach to performing 

and documenting their already required 

comparative analyses, will incur 

additional costs. Moreover, by removing 

some of the barriers to access to mental 

health and substance use disorder 

treatments caused by existing NQTLs, 

the Departments expect increased 

utilization of mental health and 

substance use disorder services, which 

will also increase costs. This collection 

of costs would appropriately be 

included in any comparison with the 

benefits described, and in some cases 

illustratively quantified, elsewhere in 

this regulatory impact analysis. 

It is notable that the Departments are 

clarifying existing requirements, and 

only the cost burden limited to those 

additional content elements outlined in 

these final rules is a key topic discussed 

in the following sections. 

8.1. Comment Summary 

In response to the proposal, many 

commenters expressed concern that the 

Departments underestimated the burden 

of collecting the required data, the 

burden required in conducting the 

proposed mathematical substantially all 

and predominant tests, the number of 

NQTLs that would need to be analyzed 

for each plan and issuer, and the 

amount of time that it would take to 

conduct those analyses. Commenters 

stated that in order to comply with the 

proposed rules, plans and issuers would 

need to purchase new data systems and 

hire additional staff or contractors. One 

commenter further stated that existing 

systems to provide mental health and 

substance use disorder benefits, such as 

carve out plans, would be eliminated 

under the proposed rule, as vendors 

would not be able to build networks of 

mental health and substance use 

disorder providers in alignment with 

networks of medical/surgical providers, 

as required under the proposed special 

rule for network composition. 

Several commenters questioned the 

Departments’ assumptions related to the 

number of NQTLs for which plans and 

issuers would need to produce 

comparative analyses. While the 

Departments assumed that issuers 

would impose twice as many NQTLs as 

plans, several commenters did not think 

the number of NQTLs would vary 

between plans and issuers. Commenters 

also argued that the number of NQTLs 

that plans and issuers would need to 

analyze would be roughly twice the 

Departments’ proposed assumption for 

issuers, 16 NQTLs rather than 8, based 

on the Departments’ descriptions of 

types of NQTLs listed in the proposed 

rule. Consistent with the explanation 

earlier in this preamble, the 

Departments note that they do not 

intend to provide an exhaustive list of 

NQTLs. Plans and issuers may be 

analyzing a fewer or greater number of 

NQTLs than the number of NQTLs 

listed in the illustrative, non-exhaustive 

list in these final rules. 

Commenters also questioned the 

amount of time that it would take to 

conduct the NQTL comparative analyses 

under the proposal. While the 

Departments assumed that the plans and 

issuers preparing their own comparative 

analyses would incur an incremental 

burden of 10 hours per NQTL in the first 

year and 4 hours per NQTL in 

subsequent years, several commenters 

thought this was an underestimate. For 

instance, one commenter stated that it 

currently takes a team of subject matter 

experts, compliance officials, a project 

manager, and attorneys or consultants 

60 hours in the first year and 12 hours 

in subsequent years to produce NQTL 

comparative analyses as required under 

the CAA, 2021 and current guidance. 

The commenter suggested that the 

added requirements for the comparative 

analysis under these final rules could 

require at least an additional 60 hours 

per NQTL. 

Another commenter estimated that 

the cost to issuers of fully insured plans 

to conduct the comparative analyses for 

all NQTLs is approximately between 

$200,000 and $300,000 (200 to 300 

external attorney or consultant hours in 

addition to several hundred in-house 

staff hours). The commenter also 

reported that for large, self-funded 

plans, while issuers and TPAs prepare 

and distribute baseline comparative 

analysis, plans would still need to 

customize the comparative analysis. The 

commenter estimated that the cost for 

large self-funded plans to customize the 

comparative analysis and request 

additional information and data for all 

NQTLs is approximately between 

$50,000 and $150,000 (100 to 200 

external attorney or consultant hours in 

addition to in-house staff work). The 

Departments are not clear whether these 

suggested costs represent current 

expenditures or projections of the added 

requirements for the comparative 

analyses. The commenter further stated 

that time and cost estimates for plans 

with behavioral carve-out vendors 

should be higher. 

In preparing these final rules, the 

Departments have considered these 

comments and have clarified the 

requirements and reevaluated their 

estimates as appropriate. The specific 

adjustments to the estimates are 

discussed in section IV.8.4 of this 

regulatory impact analysis. 

8.2. Commenters’ Cost Estimates 

As discussed earlier in this regulatory 

impact analysis, commenters questioned 

the Departments’ assumptions related to 

the number of NQTLs imposed by plans 

and issuers on mental health and 

substance use disorder benefits and 

medical/surgical benefits, and the 

amount of time that it would take to 

conduct the additional requirements for 

producing comparative analyses and 

analyzing data, beyond what was 

required in CAA, 2021. The 

Departments have reviewed these 

comments, which include estimates 

made by those commenters, on the 

expected additional costs to prepare 

NQTL comparative analyses under the 

proposed rules. While these comments 

are helpful to understand the cost 

implications of the final rules and how 

they differ from the proposal, the 

Departments disagree with some of the 

inputs and underlying assumptions of 

these cost estimates and use different 

assumptions in section IV.8.4 of this 

regulatory impact analysis. The 


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77678 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

348The wage rate of an attorney, actuary, and data 

analyst is, respectively, $165.71, $177.11, and 

$159.61. (Internal DOL calculation based on 2024 

labor cost data. For a description of DOL’s 

methodology for calculating wage rates, see EBSA, 

Labor Cost Inputs Used in the Employee Benefits 

Security Administration, Office of Policy and 

Research’s Regulatory Impact Analyses and 

Paperwork Reduction Act Burden Calculations 

(June 2019), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/rules-and-regulations/ 

technical-appendices/labor-cost-inputs-used-inebsa-opr-ria-and-pra-burden-calculations-june2019.pdf.) The composite wage rate is estimated in 

the following manner: [$165.71 × (1 ÷ 3) + $159.61 

× (1 ÷ 3) + $177.61 × (1 ÷ 3) = $167.48]. 

commenters’ cost estimates do, 

however, demonstrate a possible upper 

bound on the costs associated with 

these final rules. 

8.2.1. Association for Behavioral Health 

and Wellness 

The Departments considered 

estimates and assumptions regarding the 

costs to prepare the NQTL comparative 

analyses under the proposed rules made 

by the Association for Behavioral Health 

and Wellness (ABHW). ABHW reports 

that the amendments would require 

plans and issuers to analyze 15 NQTLs 

on average. They also reported that it 

currently takes a team of subject matter 

experts, compliance officials, a project 

manager, and attorneys or consultants 

60 hours to prepare each comparative 

analysis for a typical NQTL as required 

under the CAA, 2021 and current 

guidance. Thus, ABHW estimates that a 

comparable burden (60 hours per 

NQTL) is needed to review and revise 

the analyses under the updated 

requirements in the first year. In 

addition, they also estimate it would 

require 12 hours in each subsequent 

year to produce the comparative 

analyses. For the purpose of this 

calculation, the Departments have 

estimated a composite wage rate of 

$167.48, which consist of attorneys, 

actuaries, and data analysts.348 Based on 

these assumptions, and the 

Departments’ estimates of affected 

entities, this would result in a cost 

burden of $984.8 million in the first 

year and $197 million in subsequent 

years, resulting in a 3-year average cost 

burden of $459.6 million. See Table 3 

for more details. 

ABHW also suggested that issuers and 

plans would need to hire at least three 

full-time equivalent new staff members 

to help with the proposed relevant data 

evaluation requirements. This 

additional cost was not included in 

their cost estimates. 

TABLE 3—INCREMENTAL COST TO PREPARE THE COMPARATIVE ANALYSES BASED ON THE ASSOCIATION FOR BEHAVIORAL

HEALTH AND WELLNESS’S ASSUMPTIONS

Number of 

entities 

Number of 

NQTLs per 

entity 

Number of 

hours per 

NQTL 

Total hour 

burden 

Hourly 

wage Cost 

(A) (B) (C) (A × B × C) (D) (A × B × C × D) 

First Year 

Issuers (health insurance company/State combinations) ............................. 1,467 15 60 1,320,300 $167.48 $221,123,844 

TPAs .............................................................................................................. 205 15 60 184,500 167.48 30,900,060 

Self-funded plans with more than 500 participants that will conduct a comparative analysis themselves .................................................................... 709 15 60 638,100 167.48 106,868,988 

Self-funded plans with more than 500 participants that will receive a generic comparative analysis from TPA or service providers, and will then 

customize it ................................................................................................ 4,076 15 30 1,834,200 167.48 307,191,816 

Self-funded non-Federal governmental plans with more than 500 participants that will conduct the comparative analysis themselves .................. 505 15 60 454,500 167.48 76,119,660 

Self-funded non-Federal governmental plans with more than 500 participants that will initially receive generic comparative analyses from TPAs 

or service providers, and will then customize it ........................................ 2,906 15 30 1,307,700 167.48 219,013,596 

Plan MEWAs that are not fully insured ......................................................... 132 15 60 118,800 167.48 19,896,624 

Non-plan MEWAs that are not fully insured ................................................. 21 15 60 18,900 167.48 3,165,372 

First-year Total ....................................................................................... 10,021 15 .................... 5,877,000 .............. 984,279,960 

Subsequent Years 

Issuers (health insurance company/State combinations) ............................. 1,467 15 12 264,060 167.48 44,224,769 

TPAs .............................................................................................................. 205 15 12 36,900 167.48 6,180,012 

Self-funded plans with more than 500 participants that will conduct the 

comparative analysis themselves .............................................................. 709 15 12 127,620 167.48 21,373,798 

Self-funded plans with more than 500 participants that will receive a generic comparative analysis from TPAs or service providers, and will 

then customize it ....................................................................................... 4,076 15 6 366,840 167.48 61,438,363 

Self-funded non-Federal governmental plans with more than 500 participants that will conduct the comparative analysis themselves .................. 505 15 12 90,900 167.48 15,223,932 

Self-funded non-Federal governmental plans with more than 500 participants that will initially receive generic comparative analyses from TPAs 

or service providers, and will then customize it ........................................ 2,906 15 6 261,540 167.48 43,802,719 

Plan MEWAs that are not fully insured ......................................................... 132 15 12 23,760 167.48 3,979,325

Non-plan MEWAs that are not fully insured ................................................. 21 15 12 3,780 167.48 633,074 

Subsequent Years Total ........................................................................ 10,021 15 .................... 1,175,400 .............. 196,855,992 

Total (3-year average) .................................................................... 10,021 15 .................... 2,742,600 .............. 459,330,648 

The Departments conducted a 

sensitivity analysis of the assumption 

that 50 percent of self-funded plans and 

another 50 percent of self-funded nonFederal governmental plans with more 

than 500 participants will receive a 

generic comparative analysis from TPAs 

or service providers, which they will 

then need to customize. For every 10- 

percentage-point increase or decrease in 

the number of self-funded plans and 

self-funded non-Federal governmental 


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I I 
Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77679 

349The Departments estimate the 10-percentagepoint incremental cost by adding the total cost of 

self-funded plans and self-funded non-Federal 

governmental plans that will receive a generic 

comparative analysis from issuers, TPAs, or service 

providers and will then customize it (found in 

Table 3) in the first year and subsequent years, 

creating a 3-year average cost, and then multiplying 

the 3-year average cost by 10 percent. 

350The Departments estimate the 10-percentagepoint incremental cost in the lower bound by 

adding the total lower bound cost of self-funded 

plans and self-funded non-Federal governmental 

plans that will initially receive a generic 

comparative analysis from issuers, TPAs, or service 

providers and will then customize it (found in 

Table 4) and then multiplying the sum by 10 

percent. 

351The Departments estimate the 10-percentagepoint incremental cost in the upper bound adding 

the total upper bound cost of self-funded plans and 

self-funded non-Federal governmental plans that 

will initially receive a generic comparative analysis 

from issuers, TPAs, or service providers and will 

then customize it (found in Table 4) and then 

multiplying the sum by 10 percent. 

plans with more than 500 participants 

that need to customize documentation 

received from TPAs or service 

providers, the cost would increase or 

decrease by $24.6 million.349

8.2.2. Blue Cross Blue Shield 

Association 

The Blue Cross Blue Shield 

Association (BCBSA) asked the 

Departments to specifically quantify the 

costs of preparing additional 

comparative analysis beyond the four 

priority NQTLs outlined in FAQs Part 

45. BCBSA stated that based on the 

number of NQTLs identified in the 

regulation, and the additional NQTLs 

identified in the preamble, the proposed 

rules would require plans and issuers to 

prepare comparative analyses for at least 

17 NQTLs (7 from the preamble, and 10 

from the regulation, counting those 

related to network composition as 3 

separate NQTLs), all with the associated 

documentation and outcomes data. 

BCBSA estimated that the cost of 

issuers of fully insured plans to conduct 

the comparative analyses for all NQTLs 

would range between $200,000 and 

$300,000. BCBSA also estimated the 

cost for large self-funded plans that 

receive a generic comparative analysis 

from the issuer, which they then need 

to customize and request additional 

information and data for all NQTLs 

referenced in the proposal, is between 

$50,000 and $150,000. BCBSA did not 

explain if these cost estimates were for 

all years or were applicable to just the 

first year. Based on BCBSA’s 

assumptions, and the Departments’ 

estimates of affected entities, this will 

result in a lower bound cost of $957.4 

million and an upper bound cost of $2 

billion. See Table 4 for more details. 

TABLE 4—ANNUAL COSTS TO CONDUCT THE COMPARATIVE ANALYSES FOR ALL NQTLS BASED ON BLUE CROSS BLUE

SHIELD ASSOCIATION’S ASSUMPTIONS

Number of 

entities 

Lower bound 

cost per 

entity 

Total lower 

bound cost 

Upper bound 

cost per 

entity 

Total 

upper bound 

cost 

(A) (B) (A × B) (C) (A × C) 

Issuers (health insurance company/State combinations) ....................................... 1,467 $200,000 $293,400,000 $300,000 $440,100,000 

TPAs ........................................................................................................................ 205 200,000 41,000,000 300,000 61,500,000 

Self-funded plans with more than 500 participants that will conduct the comparative analysis themselves ...................................................................................... 709 200,000 141,800,000 300,000 212,700,000 

Self-funded plans with more than 500 participants that will receive a generic 

comparative analysis from TPAs or service providers, and will then customize 

it ........................................................................................................................... 4,076 50,000 203,800,000 150,000 611,400,000 

Self-funded non-Federal governmental plans with more than 500 participants 

that will conduct the comparative analysis themselves ...................................... 505 200,000 101,000,000 300,000 151,500,000 

Self-funded non-Federal governmental plans with more than 500 participants 

that will initially receive generic comparative analyses from TPAs or service 

providers, and will then customize it ................................................................... 2,906 50,000 145,300,000 150,000 435,900,000 

Plan MEWAs that are not fully insured ................................................................... 132 200,000 26,400,000 300,000 39,600,000 

Non-plan MEWAs that are not fully insured ........................................................... 21 200,000 4,200,000 300,000 6,300,000 

Total ................................................................................................................. 10,021 ........................ 956,900,000 ........................ 1,959,000,000 

The Departments conducted a 

sensitivity analysis of the assumption 

that 50 percent of self-funded plans and 

another 50 percent of self-funded nonFederal governmental plans with more 

than 500 participants will receive a 

generic comparative analysis from the 

issuer, and will then customize it. For 

every 10-percentage-point increase or 

decrease in the number of self-funded 

plans and self-funded non-Federal 

governmental plans with more than 500 

participants that need to customize 

documentation received from TPAs or 

service providers, the cost would 

increase or decrease by $34.9 million in 

the total lower bound cost 350 and 

$104.7 million in the total upper bound 

cost.351

8.3. Final Amendments to the Existing 

MHPAEA Regulations (26 CFR 54.9812– 

1, 29 CFR 2590.712, and 45 CFR 

146.136) 

As part of these final rules, the 

Departments have added new 

definitions, amended existing 

definitions, and clarified and added 

new requirements for NQTLs imposed 

with respect to mental health or 

substance use disorder benefits. For 

example, as discussed earlier in this 

preamble, the final rules clarify that any 

condition or disorder defined by the 

plan or coverage as being or as not being 

a mental health condition or a substance 

use disorder must be defined consistent 

with generally recognized independent 

standards of current medical practice. 

To be consistent with those generally 

recognized independent standards of 

current medical practice, these final 

rules state that the plan’s or coverage’s 

definition of ‘‘mental health benefits’’ 

must include all conditions covered 

under the plan or coverage, except for 

substance use disorders, that fall under 

any of the diagnostic categories listed in 

the mental, behavioral, and 

neurodevelopmental disorders chapter 

(or equivalent chapter) of the most 

current version of the ICD or that are 

listed in the most current version of the 

DSM. Similarly, the definition of 

‘‘substance use disorder benefits’’ must 

include all disorders covered under the 

plan or coverage that fall under any of 

the diagnostic categories listed as a 

mental or behavioral disorder due to 

psychoactive substance use (or 

equivalent category) in the mental, 

behavioral, and neurodevelopmental 

disorders chapter (or equivalent 


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77680 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

352 85 FR 72158 (Nov. 12, 2020). 

353Constance M. Horgan, Dominic Hodgkin, 

Maureen T. Stewart, Amity Quinn, Elizabeth L. 

Merrick, Sharon Reif, Deborah W. Garnick, & 

Timothy B. Creedon, Health Plans’ Early Response 

to Federal Parity Legislation for Mental Health and 

Addiction Services, 67(2) Psychiatric Services pp. 

162–168 (2016). 

354Norah Mulvaney-Day, Brent J. Gibbons, Shums 

Alikhan, & Mustafa Karakus, Mental Health Parity 

and Addiction Equity Act and the Use of Outpatient 

Behavioral Health Services in the United States, 

2005–2016, 109(S3) Am J Public Health pp. S190– 

S196 (2019). 

355Agency for Healthcare Research and Quality, 

Medical Expenditure Panel Survey, Total 

Expenditures ($) in Millions by Condition, United 

States, 2016 to 2021, https://datatools.ahrq.gov/ 

meps-hc?tab=medical-conditions&dash=17. 

356For example, the following studies found that 

telehealth treatment was as effective as in-person 

treatment: 

David Turgoose, Rachel Ashwick, & Dominic 

Murphy, Systematic Review of Lessons Learned 

from Delivering Tele-therapy to Veterans with Posttraumatic Stress Disorder, 24(9) Journal of 

Telemedicine and Telecare pp. 575–585 (2018); 

Nyssa Z. Bulkes, Kaley Davis, Brian Kay, & Bradley 

C. Riemann, Comparing Efficacy of Telehealth to InPerson Mental Health Care in Intensive-TreatmentSeeking Adults, 145 Journal of Psychiatric Research 

pp. 347–352 (2022); Jaime Moreno-Chaparro, Eliana 

I. Parra Esquivel, Angy Lucia Santos Quintero, 

chapter) of the most current version of 

the ICD or that are listed as a SubstanceRelated and Addictive Disorder (or 

equivalent category) in the most current 

version of the DSM. 

Under these final rules, plans and 

issuers are required to collect and 

evaluate relevant data in a manner 

reasonably designed to assess the 

impact of the NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits. 

In addition, these final rules require 

plans and issuers to determine whether 

the relevant data reflect material 

differences in access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

and take reasonable action, as necessary 

to address such differences to ensure 

compliance, in operation, with 26 CFR 

54.9812–1(c)(4), 29 CFR 2590.712(c)(4), 

and 45 CFR 146.136(c)(4). Relevant data 

for all NQTLs could include, as 

appropriate, but are not limited to, the 

number and percentage of claims 

denials and any other data relevant to 

the NQTL required by State law or 

private accreditation standards. 

Additionally, for NQTLs related to 

network composition, relevant data 

could include, as appropriate, but are 

not limited to, in-network and out-ofnetwork utilization rates (including data 

related to provider claim submissions), 

network adequacy metrics (including 

time and distance data, and data on 

providers accepting new patients), and 

provider reimbursement rates (for 

comparable services and as 

benchmarked to a reference standard). 

The proposed rules would have 

required plans and issuers to apply the 

proposed mathematical substantially all 

and predominant tests to each NQTL 

applicable to mental health or substance 

use disorder benefits and medical/ 

surgical benefits. As discussed earlier in 

this preamble, the Departments decline 

to finalize the proposed mathematical 

tests for applying the substantially all 

and predominant tests in these final 

rules. However, plans and issuers are 

required to collect and evaluate relevant 

data for NQTLs applicable to mental 

health and substance use disorder 

benefits and medical/surgical benefits 

under these final rules. For NQTLs 

related to network composition, plans 

and issuers must collect and evaluate 

relevant data in a manner reasonably 

designed to assess the aggregate impact 

of all such NQTLs on relevant outcomes 

related to access to mental health and 

substance use disorder benefits and 

medical/surgical benefits. Under these 

final rules, the Departments may specify 

the type, form, and manner for the 

relevant data evaluation requirement in 

future guidance, but for some plans and 

issuers already subject to existing data 

requirements under MHPAEA, Federal 

transparency rules,352 and State law and 

private accreditation standards, some of 

the additional data burden associated 

with this rulemaking will be mitigated. 

These final rules could cause plans 

and issuers to revise their policies and 

procedures to remove or modify NQTLs 

in response to the Departments’ 

clarifications and examples. 

Requirements such as covering 

meaningful benefits for mental health 

conditions and substance use disorders 

(determined in comparison to the 

benefits provided for medical 

conditions and surgical procedures); 

assessing whether the relevant data 

evaluated suggest that the NQTL 

contributes to material differences in 

access to mental health and substance 

use disorder benefits as compared to 

medical/surgical benefits; and not using 

or taking the steps necessary to correct, 

cure, or supplement the information, 

evidence, sources, or standards used to 

inform a factor or evidentiary standard 

that would have been biased or not 

objective in the absence of such steps 

could also cause plans and issuers to 

revise their policies and procedures. 

For example, a 2016 study examined 

how private health plans responded to 

the 2010 interim final rules 

implementing MHPAEA and found that 

the majority of plans had eliminated 

quantitative treatment limitations 

referred to as ‘‘special annual limits’’ 

related to behavioral health treatments. 

The percentage of health insurance 

products with such limits on mental 

health treatments decreased from 28 

percent in 2009 to 4 percent in 2010, 

and a similar decrease was observed for 

health insurance products with such 

limits on substance use disorder 

treatments (from 26 percent in 2009 to 

3 percent in 2010).353 A 2019 study of 

claims data from both a pre-parity 

(January 2005 through December 2010) 

and post-parity period (January 2011 

through September 2015), found that 

while MHPAEA did not appreciably 

increase the share of participants 

utilizing any outpatient mental health 

services, it did increase the frequency of 

use and total utilization of outpatient 

mental health and substance use 

disorder services of participants already 

receiving these services.354

Plans and issuers could incur costs to 

implement changes associated with 

revising coverage and plan provisions to 

ensure that they comply with the 

requirements of these final rules or 

ceasing the imposition of an NQTL as 

directed by the Departments or an 

applicable State authority after a final 

determination of noncompliance under 

Code section 9812(a)(8), ERISA section 

712(a)(8), or PHS Act section 2726(a)(8), 

or 26 CFR 54.9812–2, 29 CFR 2590.712– 

1, or 45 CFR 146.137, which might 

result in increased costs from expanded 

utilization of mental health and 

substance use disorder services. Recent 

data suggests that mental health and 

substance use disorder services account 

for a small portion of total health care 

expenditures, representing just 8.4 

percent of all expenses in 2021 for 

individuals with private insurance.355

The Departments face uncertainty in 

quantifying these costs and did not 

receive public comments containing 

data or information to inform these 

estimates. As such, the Departments 

cannot estimate the potential increase in 

utilization and which services might see 

the largest increase in utilization. 

8.3.1. Mitigation in Utilization Costs 

From Telehealth Expansion 

As discussed in section 2 of this 

regulatory impact analysis, individuals 

seeking mental health or substance use 

disorder treatment often face barriers 

preventing them from accessing care, 

such as inadequate networks. Telehealth 

is one method of care that has the 

potential to improve access to treatment 

for mental health conditions or 

substance use disorders, particularly as 

research has documented that it can be 

as effective as in-person treatment,356


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77681 

Laura Paez, Sandra Martinez Quinto, Bayron 

Esteven Rojas Barrios, Juan Felipe Samudio, & Karol 

Madeline Romero Villareal, Telehealth 

Interventions Aimed at Parents and Caregivers of 

Children Living in Rural Settings: A Systematic 

Review, Child Care in Practice pp. 1–24 (2022); Lori 

Uscher-Pines, Lauren E. Riedel, Ateev Mehrotra, 

Sherri Rose, Alisa B. Busch, & Haiden A. Huskamp, 

Many Clinicians Implement Digital Equity 

Strategies to Treat Opioid Use Disorder: Study 

Examines Clinicians’ Use of Telehealth and Digital 

Equity Strategies to Treat Opioid Use Disorder, 

42(2) Health Affairs pp. 182–186 (2023). 

357Some studies have found that a majority of 

clinicians and patients do not prefer audio-only 

telehealth to in-person care, implying that many of 

the benefits tied to telehealth are specifically for 

telehealth with video. For example: 

Lori Uscher-Pines, Lauren E. Riedel, Ateev 

Mehrotra, Sherri Rose, Alisa B. Busch, & Haiden A. 

Huskamp, Many Clinicians Implement Digital 

Equity Strategies to Treat Opioid Use Disorder: 

Study Examines Clinicians’ Use of Telehealth and 

Digital Equity Strategies to Treat Opioid Use 

Disorder, 42(2) Health Affairs pp. 182–186 (2023); 

Gillian K. SteelFisher, Caitlin L. McMurtry, Hannah 

Caporello, Keri M. Lubell, Lisa M. Koonin, Antonio 

J. Neri, Eran N. Ben-Porath, Ateev Mehrotra, Ericka 

McGowan, Laura C. Espino, & Michael L. Barnett, 

Video Telemedicine Experiences in COVID–19 Were 

Positive, but Physicians and Patients Prefer InPerson Care for The Future: Study Examines Patient 

and Physician Opinion of Telemedicine 

Experiences During COVID–19, 42(4) Health Affairs 

pp. 575–584 (2023). 

358Norah Mulvaney-Day, David Dean, Jr., Kay 

Miller, & Jessica Camacho-Cook, Trends in Use of 

Telehealth for Behavioral Health Care During the 

COVID–19 Pandemic: Considerations for Payers 

and Employers, 36(7) American Journal of Health 

Promotion pp. 1237–1241 (2022). 

359Congressional Research Service, Federal 

Telehealth Flexibilities in Private Health Insurance 

During the COVID–19 Public Health Emergency: In 

Brief (2023), https://crsreports.congress.gov/ 

product/pdf/R/R47424. 

360Executive Office of the President, Statement of 

Administration Policy (Jan. 30, 2023), https://

www.whitehouse.gov/wp-content/uploads/2023/01/ 

SAP-H.R.-382-H.J.-Res.-7.pdf. 

361Public Law 117–328 (Dec. 29, 2022). 

362HHS, Telehealth Policy Changes After the 

COVID–19 Public Health Emergency (Dec. 19, 

2023), https://telehealth.hhs.gov/providers/ 

telehealth-policy/policy-changes-after-the-covid-19- 

public-health-emergency#temporary-medicarechanges-through-december-31,-2024. 

363Madeline Guth, Telehealth Delivery of 

Behavioral Health Care in Medicaid: Findings from 

a Survey of State Medicaid Programs, KFF (Jan. 

2023), https://www.kff.org/mental-health/issuebrief/telehealth-delivery-of-behavioral-health-carein-medicaid-findings-from-a-survey-of-statemedicaid-programs/. 

364 Dawn A. Morales, Crystal L. Barksdale, & 

Andrea C. Beckel-Mitchener, A Call to Action to 

Address Rural Mental Health Disparities, 4 Journal 

of Clinical and Translational Science pp. 463–467 

(2020). 365 Justin Lo, Matthew Rae, Krutika Amin, 

Cynthia Cox, Nirmita Panchal, & Benjamin F. 

Miller, Telehealth Has Played an Outsized Role 

Meeting Mental Health Needs During the COVID– 

19 Pandemic, KFF Issue Brief (Mar. 15, 2022), 

https://www.kff.org/mental-health/issue-brief/ 

telehealth-has-played-an-outsized-role-meetingmental-health-needs-during-the-covid-19- 

pandemic/. 

366HHS, Health Resources and Services 

Administration, Bureau of Health Workforce, 

Designated Health Professional Shortage Areas: 

Second Quarter of Fiscal year 2024 Designated 

HPSA Quarterly Summary (Mar. 2024), https://

data.hrsa.gov/Default/GenerateHPSAQuarterly

Report. 

particularly when the treatment is 

provided through video instead of 

audio-only.357 These final rules require 

plans and issuers to collect and evaluate 

relevant data and, where the relevant 

data suggest that the NQTL contributes 

to material differences in access to 

mental health and substance use 

disorder benefits as compared to 

medical/surgical benefits in a 

classification, to take reasonable action, 

as necessary, to address the material 

differences to ensure compliance, in 

operation, with 26 CFR 54.9812–1(c)(4), 

29 CFR 2590.712(c)(4), and 45 CFR 

146.136(c)(4). One potential reasonable 

action a plan or issuer could take to 

address material differences in access 

with respect to relevant data for NQTLs 

related to network composition may 

include expanding the availability of 

telehealth arrangements to mitigate any 

overall mental health and substance use 

disorder provider shortages in a 

geographic area. 

The COVID–19 pandemic sparked 

increased demand for health care 

services, including behavioral health 

services delivered remotely. While in 

February 2020 telehealth claims 

accounted for only around 1 percent of 

claims pertaining to mental health or 

substance use disorder benefits, by 

April 2020 they accounted for over 50 

percent of the claims and still accounted 

for approximately 40 percent of claims 

at the end of 2021.358 The expansion 

was significantly aided by the 

Departments issuing guidance providing 

time-limited Federal flexibilities for 

private health plans to expand access to 

telehealth, which specifically included 

coverage of treatment for mental health 

conditions and substance use disorders. 

These Federal flexibilities included 

‘‘allowing midyear plan design changes 

to increase telehealth coverage,’’ 

‘‘allowing certain employers to offer 

coverage only for services provided via 

telehealth and other remote care 

services,’’ and ‘‘allowing telehealth 

coverage pre-deductible’’ for 

catastrophic plans and for health 

savings account-qualified high 

deductible health plans.359

While the COVID–19 PHE ended on 

May 11, 2023,360 many of the telehealth 

flexibilities it allowed were extended 

under the CAA, 2023 through December 

31, 2024.361 Additionally, Medicare has 

permanently adopted policies allowing 

patients to receive behavioral and 

mental care through telehealth within 

their homes,362 and a survey of States 

indicated that, for Medicaid, ‘‘all or 

most expansions of behavior health 

providers and/or services allowed for 

telehealth would be maintained after the 

public emergency.’’ 363 For private 

plans, access to telehealth for mental 

health and substance use disorder care 

will depend on plan design. 

By nature, telehealth makes accessing 

treatment for mental health conditions 

and substance use disorders more 

convenient for many patients, 

particularly for those who do not have 

the ability, time, or means to travel to 

an appointment or who need care from 

a provider that specializes in a 

particular treatment that is not available 

in their geographic area. Despite 

observing similar levels of mental 

illness and psychiatric disorders in 

urban residents, one research paper 

remarked that rural residents face 

‘‘challenges accessing care systems due 

to geographic isolation, reduced access 

to and engagement with appropriate 

providers, lower socioeconomic status, 

generally lower levels of educational 

attainment, as well as reluctance to seek 

help due to discrimination and 

stigma.’’ 364 An analysis of 2021 

outpatient visits reported that 55 

percent of patients in rural areas relied 

on telehealth for outpatient mental 

health and substance use services 

compared to 35 percent in urban 

areas.365 Given that 73.3 million people 

in the United States live in a geographic 

area designated as a mental health 

professional shortage area, of which 

24.4 million resided in a rural area, 

telehealth is likely to continue to be a 

necessary means to offset provider 

network limitations in these areas.366

As with rural populations, many 

underserved racial, ethnic, cultural 

minorities, and individuals with 

disabilities face barriers to receiving 

treatment for mental health conditions 

and substance use disorders. These 

barriers may include language, stigma, 

or finding a therapist that understands 

their situation. While important in 

many areas of health care, many 

underserved populations prefer to 

receive treatment for mental health 

conditions and substance use disorders 

specifically from a provider with an 

understanding of their cultural 

background. A 2022 study found that 

there was an overall increase in the use 

and willingness to use video telehealth 

during the pandemic, with the highest 

levels of increase being seen among 

Black adults and adults with lower 

educational attainment. Certain 

communities became more willing to 

use telehealth, since many patients had 

their first telehealth experience with 

their trusted health care provider during 

the pandemic and their positive 


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77682 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

367Shira H. Fischer, Zachary Predmore, Elizabeth 

Roth, Lori Uscher-Pines, Matthew Baird, & Joshua 

Breslau, Use of and Willingness to Use Video 

Telehealth Through the COVID–19 Pandemic: 

Study Examines the Use of and the Willingness to 

Use Video Telehealth During the COVID–19 

Pandemic, 41(11) Health Affairs pp. 1645–1651 

(2022). 368 Danielle M. Gainer, Celeste Wong, Jared A. 

Embree, Nina Sardesh, Amna Amin, & Natalie 

Lester, Effects of Telehealth on Dropout and 

Retention in Care Among Treatment-Seeking 

Individuals with Substance Use Disorder: A 

Retrospective Cohort Study, 58(4) Substance Use & 

Misuse pp. 481–490 (2023). 369Studies finding that telehealth has decreased 

travel expenses include: Josephine C. Jacobs, Jiaqi 

Hu, Cindie Slightam, Amy Gregory, & Donna M. 

Zulman, Virtual Savings: Patient-Reported Time 

and Money Savings from a VA National Telehealth 

Tablet Initiative, 26(8) Telemedicine and e-Health 

1178–1183 (2020); Navjit W. Dullet, Estella M. 

Geraghty, Taylor Kaufman, Jamie L. Kissee, Jesse 

King, Madan Dharmar, Anthony C. Smith, & James 

P. Marci, Impact of a University-Based Outpatient 

Telemedicine Program on Time Savings, Travel 

Costs, and Environmental Pollutants, 20(4) Value in 

Health pp. 542–546 (2017). 370William S. Frye, Lauren Gardner, & Jazmine S. 

Mateus, Utilising Telemental Health in a Paediatric 

Outpatient Psychology Clinic: Therapeutic Alliance 

and Outcomes, 22(2) Counselling and 

Psychotherapy Research pp. 322–330 (2022). 371 Jorge A. Rodriguez, Altaf Saadi, Lee H. 

Schwamm, David W. Bates, & Lipika Sama, 

Disparities in Telehealth Use Among California 

Patients with Limited English Proficiency, 40(3) 

Health Affairs pp. 487–495 (2021). 372United States Census Bureau, Computer and 

internet Use in the United States: 2018 (2021), 

https://www.census.gov/newsroom/press-releases/ 

2021/computer-internet-use.html. 373The survey found that 30.6 percent of 

respondents were working with providers who only 

offered in-person care or telehealth, while 24.4 

percent of respondents were working with 

providers who offered both modalities but chose for 

the patient. 374 Jessica Sousa, Andrew Smith, Jessica Richard, 

Maya Rabinowitz, Pushpa Raja, Ateev Mehrotra, 

Alisa B. Busch, Haiden A. Huskamp, & Lori UscherPines, Choosing or Losing in Behavioral Health: A 

Study of Patients’ Experiences Selecting Telehealth 

Versus In-Person Care, 42(9) Health Affairs pp 

1275–1282 (2023). 

375Code section 9812(a)(8)(A)(i), ERISA section 

712(a)(8)(A)(i), and PHS Act section 

2726(a)(8)(A)(i). 

376Code section 9812(a)(8)(A)(ii), ERISA section 

712(a)(8)(A)(ii), and PHS Act section 

2726(a)(8)(A)(ii). 

377Code section 9812(a)(8)(A)(iii), ERISA section 

712(a)(8)(A)(iii), and PHS Act section 

2726(a)(8)(A)(iii). 

experiences eliminated their concerns 

with telehealth, such as concerns 

related to privacy or to the level of 

engagement of a provider through 

telehealth.367

In addition to expanding access, 

telehealth has also been found to 

improve the retention of patients 

receiving mental health and substance 

use disorder care. A 2023 retrospective 

cohort study of treatment-seeking 

patients enrolled in a substance use 

disorder treatment program in Ohio 

found that ‘‘[p]atients who received 

services through telehealth with video 

in the initial 14 days of diagnosis had 

a lower hazard of dropout, compared to 

patients receiving solely in-person 

services.’’ Moreover, when compared to 

in-person care, patients receiving 

services through either video or 

telephone were more likely to have 

higher treatment engagement, which 

was defined as ‘‘initiating treatment and 

completing at least two treatment visits 

within 34 days of the initiation 

visit.’’ 368

Research has demonstrated that 

telehealth for medical appointments 

saves patients time and money.369 A 

2021 study focused specifically on the 

travel cost savings associated with using 

tele-mental health services in a pediatric 

outpatient psychology clinic. The study 

found that patients experienced a 

median of 132 miles saved by not 

travelling to an in-person session, which 

translated to a median 3.5 hours saved 

not travelling to an in-person session 

and a median cost savings of $22 per 

session over the course of the telehealth 

treatment.370 The benefits of telehealth 

are particularly relevant for mental 

health and substance use disorder 

treatment because treatment often 

requires frequent sessions or 

appointments. It is important to note that, while 

telehealth may improve access, it is not 

a perfect solution. For instance, it has 

limitations in certain segments of the 

population, such as individuals with 

limited English proficiency 371 or 

without access to computers or the 

internet.372 Additionally, many 

individuals may prefer in-person care 

over telehealth. A survey published in 

2023 showed that while patients have 

differing preferences for in-person care 

or telehealth, many are not able to find 

care that fits their preferences. Of the 

respondents receiving therapy, less than 

half were able to select whether they 

received in-person care or telehealth.373

Further, interviews conducted with 

respondents found that while many 

patients appreciate the convenience of 

telehealth, others expressed concern 

about the rapport between the patient 

and provider during telehealth. The 

authors cautioned that while telehealth 

is an attractive way to expand access to 

mental health care for much of the 

population, telehealth may not alone be 

sufficient for all individuals or 

conditions.374 Therefore, while 

telehealth may contribute significantly 

to the alleviation of mental health and 

substance use disorder provider 

shortages, it may not be a viable 

alternative for everyone. 

8.4. New Regulations (26 CFR 54.9812– 

2, 29 CFR 2590.712–1, and 45 CFR 

146.137 and 146.180) 

These final rules set forth content 

requirements for comparative analyses 

required by the CAA, 2021 and outline 

the timeframes and processes for plans 

and issuers to provide their comparative 

analyses to the Departments and 

applicable State authorities upon 

request. Under these final rules, the 

Departments outlined the elements that 

a comparative analysis must include for 

each NQTL (in addition to the 

requirements to include a written list of 

all NQTLs imposed under the plan or 

coverage). They include, as described in 

more detail earlier in this preamble: 

• A description of the NQTL, 

• Identification and definition of the 

factors used to design or apply the 

NQTL, 

• A description of how factors are 

used in the design and application of 

the NQTL, 

• A demonstration of comparability 

and stringency, as written, 

• A demonstration of comparability 

and stringency, in operation, and 

• Findings and conclusions. 

However, because these elements are 

already required under the CAA, 2021, 

the cost of these final rules is more 

limited than the full cost of generating 

a comparative analysis. For instance, 

plans and issuers are already required 

under the CAA, 2021 to provide a 

description of the specific plan or 

coverage terms or other relevant terms 

regarding the NQTLs that applies to 

such plan or coverage, and a description 

of all the mental health and substance 

use disorder benefits and medical or 

surgical benefits to which each such 

term applies in each respective benefit 

classification.375 Similarly, plans and 

issuers are already required to identify 

the factors used to determine that the 

NQTLs will apply to mental health or 

substance use disorder benefits and 

medical or surgical benefits,376 and the 

evidentiary standards used for the 

factors identified, when applicable, 

provided that every factor shall be 

defined, and any other source or 

evidence relied upon to design and 

apply the NQTLs to mental health or 

substance use disorder benefits and 

medical or surgical benefits.377


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378Code section 9812(a)(8)(A)(iv), ERISA section 

712(a)(8)(A)(iv), and PHS Act section 

2726(a)(8)(A)(iv). 379Code section 9812(a)(8)(A)(v), ERISA section 

712(a)(8)(A)(v), and PHS Act section 

2726(a)(8)(A)(v). 

380The Departments generally identify a unique 

NQTL based on whether a specific plan or issuer 

has defined the NQTL using different factors or 

evidentiary standards than other NQTLs. For 

example, if a plan applies an identical prior 

authorization requirement NQTL to four different 

benefit classifications, or to four different benefit 

package options in the same plan, the Departments 

would consider the NQTL as just one ‘‘unique’’ 

NQTL, even though it is technically four separate 

NQTLs. When a comparative analysis request is 

sent to an issuer with identical NQTLs that apply 

to many fully insured plans, the Departments 

similarly count the NQTL as one unique NQTL, 

even though there are technically many separate 

NQTLs for the different plans. The Departments 

acknowledge that if they instead counted each 

NQTL separately by benefit classification, plan, and 

product, irrespective of whether the NQTLs are 

administered in the same way in these different 

contexts, then the number of NQTLs would be 

substantially larger. This distinction may explain 

why the Departments’ estimate of NQTLs was lower 

than that of commenters. 

Moreover, the CAA, 2021 requires that 

the comparative analyses demonstrate 

that the processes, strategies, 

evidentiary standards, and other factors 

used to apply NQTLs to mental health 

and substance use disorder benefits, as 

written and in operation, are 

comparable to, and are applied no more 

stringently than, the processes, 

strategies, evidentiary standards, and 

other factors used to apply the NQTLs 

to medical or surgical benefits in the 

benefits classification,378 as well as the 

specific findings and conclusions 

reached by the plan or issuer, including 

any results of the analyses that indicate 

that the plan or coverage is or is not in 

compliance with MHPAEA.379

In their comparative analyses, plans 

and issuers must describe each NQTL 

and identify and define all the factors 

and evidentiary standards used to 

design or apply the NQTL. The plan or 

issuer also must describe how the 

factors identified are used in the design 

and application of the NQTL, and 

evaluate whether any processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the NQTL to mental health or 

substance use disorder benefits are 

comparable to, and are applied no more 

stringently than, those with respect to 

medical/surgical benefits, both as 

written and in operation. The 

explanation of how the plan or issuer 

evaluates compliance, in operation, 

with MHPAEA must identify the 

relevant data collected and evaluated, 

and document the outcomes that 

resulted from the application of the 

NQTL to mental health or substance use 

disorder benefits and medical/surgical 

benefits. In limited circumstances where 

relevant data is temporarily unavailable 

for a newly imposed NQTL, the 

comparative analysis must include a 

detailed explanation of the lack of 

relevant data, the basis for the plan’s or 

issuer’s conclusion that there is a lack 

of relevant data, and when and how the 

data will become available and be 

collected and analyzed. Additionally, in 

rare instances where no data exists that 

can reasonably assess any relevant 

impact of an NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits, 

the plan or issuer must provide a 

reasoned justification as to the basis for 

the conclusion that there are no data 

that can reasonably assess the NQTL’s 

impact, an explanation of why the 

nature of the NQTL prevents the plan or 

issuer from reasonably measuring its 

impact, an explanation of what data was 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

that the NQTL complies with MHPAEA. 

In the instances where there is a 

temporary data lag for a newly imposed 

NQTL or no data exists that can 

reasonably assess any relevant impact of 

an NQTL, providing this justification for 

the temporary data lag is likely to be 

less expensive than the estimated 

burden for doing an analysis when there 

is data. However, as explained earlier in 

this preamble, the Departments are of 

the view that nearly all NQTLs will 

have some relevant data to collect and 

evaluate; therefore, the Departments 

estimate the burden as if every plan and 

issuer performs the data analysis. 

These final rules require additional 

specificity with regard to the findings 

and conclusion of the comparative 

analysis. While these final rules provide 

specificity for how a plan or issuer must 

comply with the comparative analysis 

requirements, they are primarily 

providing additional clarification and 

requirements with respect to the 

statutory content elements of a 

comparative analysis outlined in the 

CAA, 2021, so that plans and issuers 

can perform and document sufficient 

comparative analyses. 

Additionally, for ERISA plans, these 

final rules also require the comparative 

analysis to include a certification by one 

or more named fiduciaries that they 

have engaged in a prudent process to 

select one or more qualified service 

providers to perform and document a 

comparative analysis in connection with 

the imposition of any NQTLs that apply 

to mental health and substance use 

disorder benefits under the plan in 

accordance with applicable law and 

regulations, and have satisfied their 

duty to monitor those service providers 

as required under part 4 of ERISA with 

respect to the performance and 

documentation of such comparative 

analysis. The cost to provide the 

certification is included in the cost 

estimates to prepare the comparative 

analysis. 

In the proposed rules, the 

Departments estimated that, on average, 

plans would need to analyze four 

separate NQTLs and issuers would need 

to analyze eight NQTLs to satisfy the 

comparative analysis requirements.380

The Departments further estimated that 

plans and issuers preparing their own 

comparative analyses would incur an 

incremental burden of 10 hours per 

NQTL in the first year, with 2 hours for 

a general or operations manager to 

review the requirements and outline the 

changes needed for the comparative 

analyses and 8 hours for a business 

operations specialist to prepare the 

comparative analyses. Once the 

comparative analyses are performed and 

documented, the Departments noted 

that plans and issuers would need to 

update the analyses when making 

changes to the terms of the plan or 

coverage, including changes to the way 

NQTLs are applied to mental health and 

substance use disorder benefits, as well 

as medical/surgical benefits. In 

subsequent years, the Departments 

estimated that plans and issuers would 

incur an incremental burden of 4 hours 

annually per NQTL to update the 

analyses, with 1 hour for a general or 

operations manager and 3 hours for a 

business operations specialist. 

In response to commenters’ concerns 

that the Departments underestimated 

the number of NQTLs that each plan or 

issuer would need to provide 

comparative analyses for, and that plans 

and issuers would on average have the 

same number of NQTLs, the Department 

have revised their assumptions to 10 

NQTLs for both plans and issuers. 

While one commenter suggested the 

average number of NQTLs should be 

more than 15 at a minimum, and 

another commenter noted that the 

proposal and guidance referenced at 

least 17 NQTLs, the Departments note 

that the number of NQTLs vary by 

issuer and plans and that most will not 

incorporate every NQTL listed in the 

proposal and the guidance (while some 

plans and issuers might incorporate 

others not listed). Taking into account 

the Departments’ experience and 

comments received, the Departments 

assume 10 NQTLs but present a 

sensitivity analysis using 15 NQTLs. 


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77684 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

381The wage rate of an attorney, actuary, and data 

analyst is, respectively, $165.71, $177.11, and 

$159.61. (Internal DOL calculation based on 2024 

labor cost data. For a description of DOL’s 

methodology for calculating wage rates, see EBSA, 

Labor Cost Inputs Used in the Employee Benefits 

Security Administration, Office of Policy and 

Research’s Regulatory Impact Analyses and 

Paperwork Reduction Act Burden Calculations 

(June 2019), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/rules-and-regulations/ 

technical-appendices/labor-cost-inputs-used-inebsa-opr-ria-and-pra-burden-calculations-june2019.pdf.) The composite wage rate is estimated in 

the following manner: [$165.71 × (1 ÷ 3) + $159.61 

× (1 ÷ 3) × $177.61 × (1 ÷ 3) = $167.48]. 

The Departments assume that the 

incremental costs to collect the data and 

review and revise the comparative 

analyses will require 60 hours per 

NQTL in the first year and 12 hours per 

NQTL in subsequent years. For plan 

sponsors that receive a generic 

comparative analysis from a TPA that 

will require customizing to suit the 

plan’s specific needs, the Departments 

assume that it will take 30 hours per 

NQTL in the first year and 6 hours per 

NQTL in subsequent years. While plans 

and issuers can use other professionals 

to fulfill their requirements, for 

purposes of developing the wage 

estimate, the Departments assume that it 

will take a team of data analysts, 

actuaries, and attorneys to collect the 

data and prepare the comparative 

analyses, and have estimated a 

composite wage rate of $167.48.381 See 

Table 5 for calculations and burden 

totals. 

The Departments conducted a 

sensitivity analysis of the assumption 

that plans and issuers would each 

analyze 10 NQTLs. If the Departments 

assume that plans and issuers analyze 

15 NQTLs, the cost burden would 

increase by $328.1 million in the first 

year and $65.6 million in the 

subsequent years, resulting in a 3-year 

average cost increase of $153.1 million. 

TABLE 5—INCREMENTAL COST TO FULFILL THE DATA REQUIREMENTS AND PREPARE THE COMPARATIVE ANALYSES

Number of 

entities 

Number of 

NQTLs 

per entity 

Number of 

hours per 

NQTL for 

data and 

comparative 

analysis 

Total hour 

burden 

Hourly 

wage Cost 

(A) (B) (C) (A × B × C) (D) (A × B × C × D) 

First Year 

Issuers (health insurance company/State combinations) ............................. 1,467 10 60 880,200 $167.48 $147,415,896 

TPAs .............................................................................................................. 205 10 60 123,000 167.48 20,600,040 

Self-funded plans with more than 500 participants that will conduct the 

comparative analysis themselves .............................................................. 709 10 60 425,400 167.48 71,245,992 

Self-funded plans with more than 500 participants that will receive generic 

comparative analyses from TPAs or service providers, and will then 

customize it ................................................................................................ 4,076 10 30 1,222,800 167.48 204,794,544 

Self-funded non-Federal governmental plans with more than 500 participants that will conduct the comparative analysis themselves .................. 505 10 60 303,000 167.48 50,746,440 

Self-funded non-Federal governmental plans with more than 500 participants that will initially receive generic comparative analyses from TPAs 

or service providers, and will then customize it ........................................ 2,906 10 30 871,800 167.48 146,009,064 

Plan MEWAs that are not fully insured ......................................................... 132 10 60 79,200 167.48 13,264,416 

Non-plan MEWAs that are not fully insured ................................................. 21 10 60 12,600 167.48 2,110,248 

First-year Total ....................................................................................... 10,021 .................... .................... 3,918,000 .............. 656,186,640 

Subsequent Years 

Issuers (health insurance company/State combinations) ............................. 1,467 10 12 176,040 167.48 29,483,179 

TPAs .............................................................................................................. 205 10 12 24,600 167.48 4,120,008 

Self-funded plans with more than 500 participants that will conduct the 

comparative analysis themselves .............................................................. 709 10 12 85,080 167.48 14,249,198

Self-funded plans with more than 500 participants that will receive generic 

comparative analyses from TPAs or service providers, and will then 

customize it ................................................................................................ 4,076 10 6 244,560 167.48 40,958,909 

Self-funded non-Federal governmental plans with more than 500 participants that will conduct the comparative analysis themselves .................. 505 10 12 60,600 167.48 10,149,288 

Self-funded non-Federal governmental plans with more than 500 participants that will initially receive generic comparative analyses from TPAs 

or service providers, and will then customize it ........................................ 2,906 10 6 174,360 167.48 29,201,813 

Plan MEWAs that are not fully insured ......................................................... 132 10 12 15,840 167.48 2,652,883

Non-plan MEWAs that are not fully insured ................................................. 21 10 6 2,520 167.48 422,050 

Subsequent Years Total ........................................................................ 10,021 .................... .................... 783,600 .............. 131,237,328 

Total (3-year average) .................................................................... 10,021 .................... .................... 1,828,400 .............. 306,220,432 

Additionally, plans and issuers must 

make the comparative analyses and 

other applicable information required 

by the CAA, 2021 available upon 

request to participants, beneficiaries, 

and enrollees in all non-grandfathered 

group health plans and nongrandfathered group or individual 

health insurance coverage (including a 

provider or other person acting as a 

participant’s, beneficiary’s, or enrollee’s 

authorized representative) in connection 

with an adverse benefit determination, 

as well as to participants and 

beneficiaries in plans subject to ERISA. 

The Departments estimate that on 

average each plan or issuer will receive 

one request annually and that plans and 

issuers will annually incur a burden of 

5 minutes for a clerical worker to 

prepare and send the comparative 

analyses to each requesting participant 

or beneficiary. The Departments 

received comments suggesting that this 


khammond on DSKJM1Z7X2PROD with RULES2
Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77685 

382 In Table 6, the number of ERISA-covered 

group health plans is calculated in the following 

manner: 410,581 ERISA-covered group health plans 

with 50 or more participants + 1,718,935 ERISAcovered fully insured, non-grandfathered plans 

with less than 50 participants = 2,129,516. 

383According to data from the National 

Telecommunications and Information Agency 

(NTIA), 37.4 percent of individuals age 25 and over 

have access to the internet at work. According to 

a Greenwald & Associates survey, 84 percent of 

plan participants find it acceptable to make 

electronic delivery the default option, which is 

used as the proxy for the number of participants 

who will not opt out of electronic disclosure that 

are automatically enrolled (for a total of 31.4 

percent receiving electronic disclosure at work). 

Additionally, the NTIA reports that 44.1 percent of 

individuals age 25 and over have access to the 

internet outside of work. According to a Pew 

Research Center survey, 61.0 percent of internet 

users use online banking, which is used as the 

proxy for the number of internet users who will 

affirmatively consent to receiving electronic 

disclosures (for a total of 26.9 percent receiving 

electronic disclosure outside of work). Combining 

the 31.4 percent who will receive electronic 

disclosure at work with the 26.9 percent who will 

receive electronic disclosure outside of work 

produces a total of 58.3 percent who will receive 

electronic disclosure overall. See Quantria 

Strategies, Improving Outcomes with Electronic 

Delivery of Retirement Plan Documents (June 2015), 

https://www.sparkinstitute.org/content-files/ 

improving_outcomes_with_electronic_delivery_of_

retirement_plan_documents.pdf. See also Pew 

Research Center, 51% of U.S. Adults Bank Online 

(Aug. 2013), https://www.pewresearch.org/internet/ 

wp-content/uploads/sites/9/media/Files/Reports/ 

2013/PIP_OnlineBanking.pdf. See also NTIA, NTIA 

Data Explorer (June 2024), https://www.ntia.gov/ 

data/explorer. 

384The postage for a first-class mail large 

envelope is $2.04 and the material cost is $0.05 per 

page. Thus, $2.04 + ($0.05 × 15 pages) = $2.79. 

underestimated the demand for these 

analyses as well as the cost to produce 

them. However, after reviewing data on 

the number of appealed mental health 

or substance use disorder claims per 

year, which serves as a proxy for when 

participants or beneficiaries would 

request an analysis, the Departments are 

of the view that this estimate is 

appropriate. Moreover, because plans 

and issuers are already responsible for 

preparing these analyses, the only cost 

associated with providing them are the 

clerical ones outlined earlier in this 

preamble. See Table 6 for calculations 

and burdens totaling the cost to prepare 

the analysis.382

TABLE 6—COSTS TO PREPARE THE COMPARATIVE ANALYSIS UPON PARTICIPANT REQUEST

Number of 

entities 

Number of 

NQTLs per 

entity 

Number of 

hours per 

NQTL 

Total hour 

burden 

Hourly 

wage Cost 

(A) (B) (C) (A × B × C) (D) (A × B × C × D) 

Issuers (health insurance company/State combinations) ............................. 1,467 1 0.0833 122 $65.99 $8,051 

ERISA-covered group health plans .............................................................. 2,129,516 1 0.0833 177,460 65.99 11,710,585 

Non-Federal governmental plans .................................................................. 90,887 1 0.0833 7,574 65.99 499,808 

Plan MEWAs that are not fully insured ......................................................... 132 1 0.0833 11 65.99 726 

Non-plan MEWAs that are not fully insured ................................................. 21 1 0.0833 2 65.99 132 

Annual Total ........................................................................................... 2,222,023 .................... .................... 185,169 .............. 12,219,302 

The Departments further assume that 

58.3 percent of requests will be 

delivered electronically, resulting in a 

de minimis cost.383 The remaining 41.7 

percent of requests will be mailed, at a 

cost of $2.79 each.384 See Table 7 for 

calculations and burden totaling the 

cost to distribute the analysis. 

TABLE 7—COSTS TO DISTRIBUTE THE COMPARATIVE ANALYSIS UPON PARTICIPANT OR BENEFICIARY REQUEST

Number of 

entities 

Estimated 

page length 

Paper and 

printing cost 

(per page) 

Mailing 

cost Cost 

(A) (B) (C) (D) [(A × B × C) + (A × D)] × 41.7 percent 

Issuers (health insurance company/State combinations) ..................................... 1,467 15 $0.05 $2.04 $1,603 

ERISA-covered Group Health Plans ..................................................................... 2,129,516 15 0.05 2.04 2,326,581 

Non-Federal Governmental Plans ........................................................................ 90,887 15 0.05 2.04 105,741 

Plan MEWAs that are not fully insured ................................................................. 132 15 0.05 2.04 144 

Non-plan MEWAs that are not fully insured ......................................................... 21 15 0.05 2.04 23 

Annual Total ................................................................................................... 2,222,023 ...................... ........................ .............. 2,585,169 


khammond on DSKJM1Z7X2PROD with RULES2
77686 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

385The reading time is calculated based on an 

average 250 words per minute reading rate. 

386CMS, National Health Expenditure Data, NHE 

Tables—Table 24, https://www.cms.gov/ResearchStatistics-Data-and-Systems/Statistics-Trends-andReports/NationalHealthExpendData/national

healthaccountshistorical. 

387CMS, National Health Expenditure Data, NHE 

Tables—Table 21, https://www.cms.gov/ResearchStatistics-Data-and-Systems/Statistics-Trends-andReports/NationalHealthExpendData/ 

nationalhealthaccountshistorical. 

388The cost is estimated as follows: $656.2 

million for collecting the data and preparing the 

comparative analyses + $10.8 million for reviewing 

the final rules and amendments + $12.2 million to 

prepare the comparative analyses upon request of 

participants and beneficiaries + $2.6 million to 

distribute the comparative analyses to participants 

and beneficiaries + $0.02 million for audit of 

comparative analyses = $681.8 million. 

389The cost is estimated as follows: $131.2 

million for collecting the data and preparing the 

comparative analyses + $12.2 million for preparing 

the comparative analyses upon request of 

participants and beneficiaries + $2.6 million to 

distribute the comparative analyses to participants 

and beneficiaries + $0.02 million for audit of 

comparative analyses = $146.1 million. 

Finally, these final rules require that 

group health plans and health insurance 

issuers offering group or individual 

health insurance coverage must make 

comparative analyses available upon 

request to the Departments or an 

applicable State authority. The CAA, 

2021 requires the Departments to collect 

no fewer than 20 comparative analyses 

per year, but it also provides that the 

Departments shall request that a group 

health plan or issuer submit the 

comparative analyses for plans that 

involve potential MHPAEA violations or 

complaints regarding noncompliance 

with MHPAEA that concern NQTLs, 

and any other instances in which the 

Departments determine appropriate. 

Based on prior experience and current 

funding, DOL and HHS expect to each 

request 20 comparative analyses each 

year. To provide the Departments with 

their comparative analyses and 

associated documentation, the 

Departments estimate, based on internal 

discussion, that it will take a total of 5 

hours for plans, with 1 hour for a 

general or operations manager and 4 

hours for a business operations 

specialist. See Table 8 for calculations 

and burden totals. 

TABLE 8—COSTS OF PROVIDING COMPARATIVE ANALYSES FOR AUDITS

Number of 

entities 

Hour 

burden per 

entity 

Total hour 

burden 

Hourly 

wage Cost 

(A) (B) (A × B) (C) (A × B × C) 

General Operations Manager (Requested by HHS) ................................................................... 20 1 20 $137.67 $2,753 

Business Operations Specialist (Requested by HHS) ................................................................ 20 4 80 114.36 9,149 

General Operations Manager (Requested by DOL) ................................................................... 20 1 20 137.67 2,753 

Business Operations Specialist (Requested by DOL) ................................................................ 20 4 80 114.36 9,149 

Total ..................................................................................................................................... 40 .................... 200 .............. 23,804 

In the first year, group health plans 

and issuers will need time to familiarize 

themselves with these final rules to 

ensure that their comparative analyses 

comply with all applicable 

requirements. The Departments assume 

that on average it will require 6.5 hours 

for an attorney to review these final 

rules.385 See Table 9 for calculations 

and burden totals. 

TABLE 9—COSTS FOR RULE FAMILIARIZATION

Number of 

entities 

Number of 

NQTLs per 

entity 

Hour 

burden per 

entity 

Total hour 

burden 

Hourly 

wage Cost 

(A) (B) (C) (A × B × C) (D) (A × B × C × D) 

First Year 

Issuers (health insurance company/State combinations) ........................... 1,467 1 6.5 9,536 $165.71 $1,580,211 

TPAs ............................................................................................................ 205 1 6.5 1,333 165.71 220,891 

Self-funded plans with more than 500 participants that will conduct the 

comparative analysis themselves ............................................................ 709 1 6.5 4,609 165.71 763,757 

Self-funded plans with more than 500 participants that will receive generic comparative analyses from TPAs or service providers, and will 

then customize it ..................................................................................... 4,076 1 6.5 26,494 165.71 4,390,321 

Self-funded non-Federal governmental plans with more than 500 participants that will conduct the comparative analysis themselves ................ 505 1 6.5 3,283 165.71 544,026 

Self-funded non-Federal governmental plans with more than 500 participants that will initially receive generic comparative analyses from TPAs 

or service providers, and will then customize it ...................................... 2,906 1 6.5 18,889 165.71 3,130,096 

Plan MEWAs that are not fully insured ....................................................... 132 1 6.5 858 165.71 142,179 

Non-plan MEWAs that are not fully insured ............................................... 21 1 6.5 137 165.71 22,702 

First-year Total ..................................................................................... 10,021 .................... .................... 65,139 ................ 10,794,184 

According to the 2022 National 

Health Expenditure Data, the total 

contribution of private employers to 

health insurance premiums is $592.2 

billion. The total contribution of State 

and local employers to health insurance 

premiums is $194.5 billion.386 The total 

health expenditure on the individual 

market is $93.9 billion.387 In the first 

year, the cost to comply with these final 

rules is estimated to be approximately 

$681.8 million,388 which represents 0.08 

percent of total premiums in these 

markets. In subsequent years, the cost to 

comply with these final rules is 

estimated to be approximately $146.1 

million,389 which represents 0.02 


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I I 
Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77687 

390 Jan Fawcett, The Neurological Basis of Suicide 

(2012). 

391Ronald C. Kessler, Patricia Berglund, Olga 

Demler, Robert Jin, Kathleen R. Merikangas, & Ellen 

E. Walters, Lifetime Prevalence and Age-of-Onset 

Distributions of DSM–IV Disorders in the National 

Comorbidity Survey Replication, 62(6) Arch Gen 

Psychiatry pp. 593–602 (2005). 

392Navneet Bains & Sara Abdijadid, Major 

Depressive Disorder (2023). 

393 Ian Rockett, Rockett, Ian RH, Shuhui Wang, 

Yinjuan Lian, & Steven Stack, Suicide-Associated 

Comorbidity Among US Males and Females: A 

Multiple Cause-of-Death Analysis, 13(5) Injury 

Prevention pp. 311–315 (2007). 

394Navneet Bains & Sara Abdijadid, Major 

Depressive Disorder (2023). 

395SAMHSA, 2022 National Survey on Drug Use 

and Health (Nov. 2023), https://www.samhsa.gov/ 

data/report/2022-nsduh-detailed-tables. 

percent of total premiums in these 

markets. 

In the proposed rules, HHS assumed 

that most of the self-funded non-Federal 

governmental plans that would be 

affected by the implementation of the 

CAA, 2023 provision that sunsets the 

MHPAEA opt-out election offered 

mental health and substance use 

disorder benefits, but that many of these 

plans might not be complying with 

MHPAEA. HHS assumed that plans 

would incur costs to come into 

compliance and noted that, in 

particular, some plans might remove 

limits on or offer more generous mental 

health and substance use disorder 

benefits, which would likely increase 

utilization of mental health and 

substance use disorder services, 

increasing the number of claims 

submitted, and the overall costs 

incurred by these plans. HHS also noted 

that plans that have opted out of 

requirements under MHPAEA would 

also need to conduct NQTL comparative 

analyses if they were not already doing 

so. HHS solicited comments on the 

potential costs to these plans to come 

into compliance with MHPAEA. 

Although the Departments received 

comments on the potential 

underestimation of costs related to 

NQTL comparative analysis 

requirements (refer to section IV.8.1 of 

this regulatory impact analysis for 

further discussion), HHS did not receive 

any comments specific to the costs 

associated with coming into compliance 

for self-funded non-Federal 

governmental plans. As such, HHS is 

unable to estimate the costs to these 

plans because the extent to which these 

plans are currently out of compliance is 

unknown, and costs associated with 

coming into compliance are expected to 

vary from plan to plan. 

HHS estimates that the regulatory 

amendments to implement a provision 

of the CAA, 2023 that sunsets the 

election option for sponsors of selffunded non-Federal governmental plans 

to opt out of requirements under 

MHPAEA eliminates the need for 

sponsors to submit a notice to the 

Federal Government regarding their 

plan’s opt-out election, as long as the 

sponsors do not elect to permissibly opt 

out of other requirements. HHS 

estimates that sponsors of 185 plans will 

no longer submit a notice to the Federal 

Government regarding their plan’s optout election. This is estimated to 

generate a total cost savings of 

approximately $11,783 for plans (as 

discussed later in section V.2.5 of the 

Paperwork Reduction Act analysis for 

HHS), and cost savings of approximately 

$5,200 for the Federal Government as 

HHS will no longer have to process the 

opt-out notices previously submitted by 

these plans. 

8.5. Illustration of Cost Increases for 

Plans and Issuers 

As discussed in the benefits section, 

the Departments estimate that the final 

rules will increase access and 

subsequently the utilization or 

frequency of use of behavioral health 

services. The Departments also 

recognize that increased service 

utilization will likely increase costs for 

plans. These costs will likely differ 

significantly by the type of condition 

and the type of treatment. The analysis 

that follows provides an illustration of 

potential increases in costs for plans 

associated with depression and 

substance use disorder treatments. 

Increasing access to mental health 

services is estimated to result in a 

significant reduction in suicides, as 

enumerated in section IV.7.2. While 

many mental health conditions and 

substance use disorders may increase 

the risk of suicide, suicide itself is an 

outcome that may or may not be tied 

directly to mental health conditions or 

substance use disorders. As such, it is 

difficult to directly tie the decrease in 

suicides discussed in section IV.7.2 to 

increased costs. 

However, the most common mental 

health condition among those who 

attempt suicide, as well as one of the 

most highly prevalent mental health 

conditions in the United States, is 

depressive disorder.390 391 Research 

indicates that individuals with major 

depressive disorder are at an elevated 

risk of suicide and that approximately 

two-thirds have contemplated 

suicide.392 Furthermore, major 

depressive disorder was the most 

common comorbid condition in a study 

of U.S. suicides, followed by substance 

use disorder.393 Individuals with major 

depressive disorder and another 

comorbid condition (such as a substance 

use disorder or anxiety disorder) are at 

even greater risk of suicide.394 Data from 

the 2022 NSDUH indicates that 

approximately 8 percent of individuals 

who have private health insurance 

experienced a major depressive episode 

in the past year, of whom 64 percent 

received treatment for depression.395

TABLE 10—NUMBER OF PEOPLE DIAGNOSED WITH A MAJOR DEPRESSIVE EPISODE IN THE PAST YEAR

2021 2022 

Total: 

All Ages ................................................................................................................................................ 21,553,000 22,475,000 

With Private Health Insurance .............................................................................................................. 11,750,000 12,551,000 

Receiving Treatment for Depression: 

All Ages ................................................................................................................................................ 12,932,000 14,088,000 

With Private Health Insurance .............................................................................................................. 7,540,000 8,240,000 

Not Receiving Treatment for Depression: 

All Ages ................................................................................................................................................ 8,621,000 8,387,000 

With Private Health Insurance .............................................................................................................. 4,210,000 4,311,000 

SAMHSA, 2022 National Survey on Drug Use and Health (Nov. 2023), https://www.samhsa.gov/data/report/2022-nsduh-detailed-tables. 

As discussed in Section 6.1.3, 

MHPAEA has been found to have mixed 

effects on the utilization of mental 

health services. A 2019 study found 

that, outside of substance use disorder, 

MHPAEA was not associated with an 


khammond on DSKJM1Z7X2PROD with RULES2
77688 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

396Noah Mulvaney-Day, Brent Gibbons, Shums 

Alikhan, & Mustafa Karakus, Mental Health Parity 

and Addiction Equity Act and the Use of Outpatient 

Behavioral Health Services in the United States, 

2005–2016, 109(3) American Journal of Public 

Health pp. 190–196 (2019). 

397Brian K. Ahmedani, Joslyn Westphal, Kirsti 

Autio, Farah Elsiss, Edward L. Peterson, Arne Beck, 

Beth E. Waitzfelder, Rebecca C. Rossom, Ashli A. 

Owen-Smith, Frances Lynch, Christine Y. Lu, 

Cathrine Frank, Deepak Prabhakar, Jordan M. 

Braciszewski, Lisa R. Miller-Matero, Hsueh-Han 

Yeh, Yong Hu, Riddhi Doshi, Stephen C. Waring, 

& Gregory E. Simon, Variation in Patterns of Health 

Care Before Suicide: A Population Case-Control 

Study, 127 Prev Med. (2019), https://

www.ncbi.nlm.nih.gov/pmc/articles/PMC6744956/. 

398Elizabeth Evans, Libo Li, Jeong Min, David 

Huang, Darren Urada, Lei Liu, Yih-Ing Hser, & 

Bohdan Nosyk, Mortality Among Individuals 

Accessing Pharmacological Treatment for Opioid 

Dependence in California, 2006—2010, 110(6) 

Addiction pp. 996–1005 (2015), https://

pubmed.ncbi.nlm.nih.gov/25644938/. 

399This is calculated by applying the coefficient 

estimates found in Table 2 of the study that denote 

the average monthly insurer spending per service 

user. The study includes 129 months of data, of 

which 57 are in the post-period. For month 57, the 

cost is estimated to be $86.64 absent MHPAEA and 

$102.81 with the implementation of MHPAEA. The 

study estimates that insurer spending per service 

user will continue to increase over time. However, 

this linear trend was established within the sample. 

The Department hesitates to extrapolate the linear 

trend outside of the sample. Additionally, the study 

does not include overall significant or joint 

significant tests of this regression. (See Noah 

Mulvaney-Day, Brent Gibbons, Shums Alikhan, & 

Mustafa Karakus, Mental Health Parity and 

Addiction Equity Act and the Use of Outpatient 

Behavioral Health Services in the United States, 

2005–2016, 109(3) American Journal of Public 

Health pp. 190–196 (2019).) 

400 In 2015, 9,257,000 individuals with private 

insurance had a major depressive episode, of which 

6,381,000 received treatment for depression. (See 

SAMHSA, Results from the 2015 National Survey 

on Drug use and Health: Detailed Tables (Sept. 

2016), https://www.samhsa.gov/data/sites/default/ 

files/NSDUH-DetTabs-2015/NSDUH-DetTabs-2015/ 

NSDUH-DetTabs-2015.pdf.) This represents 

approximately 69 percent. As such, the 

Departments estimate the per-member cost increase 

as: $16.17 per member receiving treatment × 69 

percent of members with depression receiving 

treatment = $11.15 per member with depression 

(regardless of treatment status). 

401This cost estimate is calculated from costs 

incurred by both the participant and the insurer, 

similar to expenditures used elsewhere in this 

analysis, such as the Medical Expenditure Panel 

Survey Household Component (MEPS–HC). 

402Melek (2018) uses 2015 claims data and apply 

annual cost trends to estimate 2017 values. The 

report states that they use an annual cost trend of 

10 percent to behavioral health care and 12 percent 

to behavioral prescription costs. For someone with 

a serious and persistent mental illness, the report 

estimates that the per-member per-month cost was 

$119.00 for behavioral health care (i.e. behavioral 

inpatient, outpatient, professional care) and $159.00 

for behavioral prescriptions, resulting in a total cost 

of $178.00. The weighted average per-member permonth cost of having any mental illness, the report 

estimates a cost of $55.08 for behavioral health care 

and $89.14 for behavioral prescriptions, resulting in 

a total of $142.22. Discounting the behavioral health 

care and behavioral prescription costs by the 

respective annual cost trend, results in an estimate 

of a per-member per-month cost of $225.10 for 

someone with a serious and persistent mental 

illness and $116.59 on average for someone with 

any mental illness. (See Stephen Melek, Douglas 

Norris, Jordan Paulus, Katherine Matthews, 

Alexandra Weaver, & Stoddard Davenport, Potential 

Economic Impact of Integrated Medical-Behavioral 

Healthcare, Milliman Research Report (Jan. 2018)) 

403Agency for Healthcare Research and Quality, 

Total Expenditures ($) in Millions by Condition and 

Source of Payment, United States, 2021, Medical 

Expenditure Panel Survey. 

404This is estimated as: $21.02 billion × 5.0 

percent (9.6 percent) = $1.0 billion ($2.0 billion). 

405The estimates in 2023 dollars are estimated 

using the Consumer Price Index (CPI) medical care 

cost. 

increase in new utilization of behavioral 

healthcare. However, the authors did 

find an increase in the average 

frequency of monthly outpatient 

services per user.396 Critically, 

increased frequency of mental health 

and OUD treatment utilization have 

both been associated with decreasing 

risks of mortality from suicide and 

OUD.397 398

The 2019 study also found that the 

average insurer cost for members 

receiving treatment increased following 

the passage of MHPAEA. According to 

the study, in September 2015, the last 

month of data considered, MHPAEA 

was associated with an average insurer 

cost increase of $16.17 for each member 

receiving treatment for mental health 

per month.399

For the purposes of this analysis, it is 

helpful to consider this measurement in 

terms of the increased cost per member 

with depression, regardless of treatment 

status. To estimate a per-member cost, 

regardless of treatment status, the 

Departments scaled the estimate by the 

proportion of individuals who had a 

major depressive episode in 2015, with 

private insurance, and who received 

treatment for depression. Applying 

these assumptions, the Departments 

estimate that in 2015, MHPAEA was 

associated with a $11.15 increase in 

average monthly insurer spending per 

member with depression.400

The Departments do not have data on 

per-member per-month costs associated 

with a major depressive illness alone. 

Based on a 2018 Milliman report, the 

Departments estimate that the 2015 permember per-month behavioral 

healthcare cost 401—including 

behavioral inpatient, outpatient, 

professional, and prescription drug 

costs—was $225.10 for someone with a 

serious and persistent mental illness 

and $116.59 on average for someone 

with any mental illness.402 Milliman 

defines a serious and persistent mental 

illness as someone treated for bipolar 

disorder, major depression, paranoid 

and other psychotic disorder, or 

schizoaffective disorder. As costs to 

treat bipolar disorder, psychotic 

disorder, and schizoaffective disorder 

are likely higher than costs to treat 

major depression, on average, the 

Departments are of the view that the 

per-member per-month costs represent 

an overestimate for costs to treat major 

depression. Similarly, the Departments 

expect that the per-member per-month 

costs to treatment someone with any 

mental illness likely represent an 

underestimate due to factors such as 

underdiagnosis, comorbidities, and 

delayed treatments. Additionally, the 

per-member per-month costs may not 

fully capture indirect costs or the cost 

of out-of-network care, further 

suggesting that the total costs of 

adequately treating mental illness are 

likely higher. As such, the Departments 

are of the view that these two measures 

create a reasonable range with regard to 

major depression. 

Based on this analysis, the estimated 

$11.15 increase in monthly insurer 

spending per-member with depression 

accounts for 5.0 percent of the permember per-month costs for someone 

with a serious and persistent mental 

illness or 9.6 percent of the average cost 

for someone with any mental illness. In 

2021, total expenditures for private 

insurance were $981.2 billion, while 

total expenditures for private insurance 

for depression were $21.0 billion.403 For 

illustrative purposes, if it is assumed 

that the increase in costs associated 

with MHPAEA had accounted for 

between 5.0 percent and 9.6 percent of 

private insurance expenditures for 

depression in 2021, this would account 

for between $1.0 billion and $2.0 billion 

of total expenditures for private 

insurance for depression.404

In their estimate of benefits associated 

with the prevention of suicide fatalities 

and reduced mortality from the 

utilization of OUD treatments, the 

Departments assumed that the effect of 

these final rules would be 

approximately 40 percent of the initial 

impact from MHPAEA. For consistency, 

applying this proportion to the 

estimated costs, the Departments 

estimate that these final rules would be 

associated with an increase cost for 

treatment related to depression for 

private insurers of between $0.42 billion 

and $0.80 billion in 2021 dollars or 

$0.43 billion and $0.84 billion in 2023 

dollars.405

It is important to note that the benefits 

estimated in section IV.7.2 and these 

cost estimates do not necessarily 

capture the same segment. The benefits 

related to more frequent treatment of 

depression are more expansive than the 

estimated benefits in section IV.7.2 that 

only focus on suicide prevention. On 

the other hand, treatment for other types 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77689 

406Mengyao Li, Cora Peterson, Likang Xu, 

Christina A. Mikosz, & Feijun Luo, Medical Costs 

of Substance Use Disorders in the US EmployerSponsored Insurance Population, 6(1) JAMA Netw 

Open (2023), https://pubmed.ncbi.nlm.nih.gov/ 

36692881/. 

407The OUD treatment cost estimate of $11,871 

has been adjusted using the CPI for medical care 

cost to 2023 dollars. See Mengyao Li, Cora Peterson, 

Likang Xu, Christina A. Mikosz, & Feijun Luo, 

Medical Costs of Substance Use Disorders in the US 

Employer-Sponsored Insurance Population, 6(1) 

JAMA Netw Open (2023), https://

pubmed.ncbi.nlm.nih.gov/36692881/. 

408 $13,448 OUD treatment cost × 43,054 

additional persons receiving treatment = 

$578,990,192. 

409Tami L. Mark & William Parish, Behavioral 

Health Parity—Pervasive Disparities in Access to InNetwork Care Continue, RTI International (Apr. 

2024), https://dpjh8al9zd3a4.cloudfront.net/ 

publication/behavioral-health-parity-pervasivedisparities-access-network-care-continue/ 

fulltext.pdf. 

410Before the parity directive, average out-ofpocket spending was $787 for someone with bipolar 

disorder, $563 for someone with major depression, 

and $428 for someone with adjustment disorder. 

See Alisa B. Busch, Frank Yoon, Colleen L. Barry, 

Vanessa Azzone, Sharon-Lise T. Normand, Howard 

H. Goldman, & Haiden A. Huskamp, The Effects of 

Parity on Mental Health and Substance Use 

Disorder Spending and Utilization: Does Diagnosis 

Matter?, 170(2) The American Journal of Psychiatry 

p. 180 (2013). 

411Alene Kennedy-Hendricks, Andrew J. Epstein, 

Elizabeth A. Stuart, Rebecca L. Haffajee, Emma E. 

McGinty, Alisa B. Busch, Haiden A. Huskamp, & 

Colleen L. Barry, Federal Parity and Spending for 

Mental Illness, 142(2) Pediatrics (2018). 

412Rebecca L. Haffajee, Michelle M. Mello, Fang 

Zhang, Alisa B. Busch, Alan M. Zaslavsky, & J. 

Frank Wharam, Association of Federal Mental 

Health Parity Legislation with Health Care Use and 

Spending Among High Utilizers of Services, 57(4) 

Medical Care p. 245. 

of mental health conditions or substance 

use disorders may also contribute to the 

decreased prevalence of suicides, the 

cost of which is not considered in this 

illustration. 

Additionally, the Departments 

estimate that the final rules will 

increase the utilization of substance use 

disorder services (specifically, OUD), 

resulting in significant benefits arising 

from decreased mortality related to 

substance use disorders. These benefits 

would arise from approximately 40,000 

additional individuals receiving 

treatment each year. As recent research 

indicates that cost of treatment for OUD 

is approximately $13,500, the 

Departments estimate that the increased 

service utilization for OUD would result 

in an additional cost of approximately 

$579 million annually.406 407 408

9. Transfers 

Achieving parity in coverage of 

mental health and substance use 

disorder benefits has the potential to 

change the spending patterns of plans 

and issuers, increase premiums and 

contributions, and change the 

utilization patterns of participants, 

beneficiaries, and enrollees. The 

Departments recognize these as transfers 

among participants, beneficiaries, and 

enrollees; plans and issuers; and mental 

health and substance use disorder 

providers and facilities. Specifically, the 

Departments expect these final rules 

will result in: 

• transfers from plans and issuers to 

participants, beneficiaries, and enrollees 

caused by lower out-of-pocket spending; 

• transfers from participants, 

beneficiaries, and enrollees to plans and 

issuers caused by higher premiums; and 

• transfers between primary care 

providers and mental health and 

substance use disorder providers for the 

treatment of mental health and 

substance use disorders resulting from 

the anticipated shift of participants, 

beneficiaries, and enrollees choosing to 

obtain such treatment from a specialist 

instead of a primary care provider. 

The following sections are primarily 

qualitative discussions of transfers that 

the Departments expect to occur due to 

these final rules. Where possible, the 

Departments have referenced studies 

with quantitative results that help 

indicate the potential magnitude of 

these transfers. The Departments 

requested comment or data in the 

proposal on how large these transfers 

might be but did not receive any 

comments. 

9.1. Transfers From Plans and Issuers to 

Participants, Beneficiaries, and 

Enrollees Caused by Lower Out-ofPocket Spending 

As discussed in section IV.7.2 of this 

regulatory impact analysis, these final 

rules are expected to increase access to 

mental health and substance use 

disorder treatments by improving plan 

and issuer compliance with the 

requirements under MHPAEA. This will 

help ensure that NQTLs are no more 

restrictive for mental health and 

substance use disorder benefits than the 

predominant limitations applicable to 

substantially all medical/surgical 

benefits. For individuals who were 

previously prevented from accessing 

care because it was not covered by their 

plan or coverage in a manner that 

violated these final rules, improved 

access to treatment is a benefit. 

However, for individuals who 

previously resorted to out-of-network 

treatment, expanded coverage of 

treatment—resulting in more access to 

in-network providers or facilities—will 

result in a transfer from plans and 

issuers to participants, beneficiaries, 

and enrollees. 

Currently, it is more common for 

individuals to rely on out-of-network 

care for mental health and substance use 

disorder treatment than for medical/ 

surgical treatment. One study found that 

patients received out-of-network care 

3.5 times more often for behavioral 

health clinician office visits than for 

medical and surgical clinician office 

visits (13.4 percent vs. 3.8 percent). 

Further, the study found that when 

comparing specialist care, patients 

received out-of-network care 8.9 times 

more often for psychiatrist office visits 

(15.3 percent vs. 1.7 percent) and 10.6 

times more often for psychologist office 

visits (18.2 percent vs. 1.7 percent) than 

for medical and surgical specialist 

physicians.409

Receiving out-of-network treatment is 

costly, and research has found that 

mental health parity decreases out-ofpocket spending on treatment. For 

example, a 2013 study that examined 

the impact of the 2001 parity directive 

in the FEHB Program found that annual 

out-of-pocket spending for FEHB 

enrollees diagnosed with bipolar 

disorder, major depression, or 

adjustment disorder decreased by 

between $78 and $86, roughly between 

11 percent and 18 percent of average 

total out-of-pocket spending for 

enrollees with one of these diagnoses, as 

compared to before the parity 

directive.410

A 2018 study compared commercially 

insured children ages 3 to 18 years in 

2008 who were continuously enrolled in 

plans newly subject to parity under 

MHPAEA to children continuously 

enrolled in plans never subject to 

MHPAEA. The study found that 

children with mental health conditions 

who were enrolled in plans subject to 

parity had, on average, $140 lower 

annual out-of-pocket mental health 

spending than expected compared to the 

comparison group. The study further 

found that children at or above the 85th 

percentile in total mental health 

spending who were enrolled in plans 

subject to MHPAEA had, on average, 

$234 lower annual out-of-pocket mental 

health spending than those in the 

comparison group.411

A 2019 study examined the impact of 

MHPAEA on mental health services 

spending in a commercially insured 

population diagnosed with mental 

health disorders and found that 

MHPAEA resulted in a decrease in the 

mean out-of-pocket spending per mental 

health outpatient visit.412 Additionally, 

a 2017 study that examined 

expenditures of patients receiving 

behavioral health treatment following 

the implementation of MHPAEA found 

that the out-of-pocket expenditure for 


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413Susan L. Ettner, Jessica M. Harwood, Amber 

Thalmayer, Michael K. Ong, Haiyong Xu, Michael 

J. Bresolin, Kenneth B. Wells, Chi-Hong Tseng, & 

Francisca Azocar, The Mental Health Parity and 

Addiction Equity Act Evaluation Study: Impact on 

Specialty Behavioral Health Utilization and 

Expenditures Among ‘‘Carve-Out’’ Enrollees, 50 

Journal of Health Economics pp. 131–143 (2016). 

414As defined in the MEPS–HC, mental disorders 

include anxiety, depression, bipolar disorder, 

schizophrenia, obsessive-compulsive disorder, 

attention-deficit and/or hyperactivity disorder, 

substance use disorder, and other mental and 

neurodevelopmental illnesses. 

415Anita Soni, Healthcare Expenditures for 

Treatment of Mental Disorders: Estimates for Adults 

Ages 18 and Older, U.S. Civilian 

Noninstitutionalized Population, 2019, Agency for 

Healthcare Research and Quality, Statistical Brief 

#539 (Feb. 2022), https://meps.ahrq.gov/data_files/ 

publications/st539/stat539.pdf. 

416Nicole M. Benson & Zirui Song, Prices and 

Cost Sharing for Psychotherapy In Network Versus 

Out Of Network in the United States, 39(7) Health 

Affairs pp. 1210–1218 (2020). 

417Agency for Healthcare Research and Quality, 

Number of Events in Thousands by Condition and 

Insurance Coverage, United States, 2021, Medical 

Expenditure Panel Survey, https://

datatools.ahrq.gov/meps-hc?tab=medicalconditions&-=17. 

418Tami L. Mark & William Parish, Behavioral 

Health Parity—Pervasive Disparities in Access to InNetwork Care Continue, RTI International (Apr. 

2024), https://dpjh8al9zd3a4.cloudfront.net/ 

publication/behavioral-health-parity-pervasivedisparities-access-network-care-continue/ 

fulltext.pdf. 

419This estimate is calculated as follows: 530.7 

million medical events × change in share that are 

out-of-network (13.4 percent ¥ 12.1 percent) × 

$24.41 = $168.4 million. 

420Steve Melek, The Cost of Mental Health Parity, 

Health Section News, Issue 49 (2005), as presented 

to the Society of Actuaries, https://www.soa.org/ 

globalassets/assets/library/newsletters/healthsection-news/2005/march/hsn-2005-iss49-melekb.pdf. 

patients had decreased and the total 

expenditure for health plans had 

increased, with no significant impact on 

health care utilization, suggesting that 

the costs had shifted from patients to 

health plans.413

According to the 2019 MEPS–HC, 

private insurance covered $33.87 billion 

of expenditures for treatment of mental 

health disorders among adults ages 18 

and older 414 while all individuals paid 

$15.62 billion out-of-pocket.415 As 

discussed throughout this analysis, 

there are many reasons someone might 

seek care out-of-network or pay out-ofpocket for treatment, such as limited 

coverage from the issuer or plan, 

difficulty finding a network provider, or 

long wait times to see an in-network 

provider. The Departments acknowledge 

that these final rules will not address all 

the reasons that individuals pay out-ofpocket for treatment, and there is 

significant uncertainty in how these 

final rules will affect out-of-network 

spending. 

Accordingly, the Departments do not 

know what proportion of total out-ofpocket spending experienced in the past 

will be covered by group health plans 

and health insurance coverage following 

the applicability of these final rules. 

However, to illustrate the potential scale 

of transfers from participants, 

beneficiaries, and enrollees to plans 

under this rulemaking, the Departments 

reference a 2020 study of in-network 

versus out-of-network psychotherapy 

employer-sponsored insurance claims 

which found in-network cost sharing 

was, on average, $24.41 less that out-ofnetwork cost-sharing for psychotherapy 

claims.416 Utilizing tabulations from the 

MEPS–HC on events, such as office and 

outpatient visits for mental, behavioral, 

or neurological conditions, there were 

530.7 million of these medical events in 

2021 for individuals 65 and under with 

private insurance.417 Applying the 

initial out-of-network rates of 13.4 

percent from the Marsh and Parish 

paper would translate into 71.1 million 

out-of-network claims, which is 9 

percentage points higher for mental 

health and substance use disorders than 

for medical/surgical treatments.418 It is 

assumed that, under these final rules, 

the out-of-network utilization rates for 

mental health and substance use 

disorder benefits fall by just 10 percent 

to 12.1 percent of claims, this would 

still represent a transfer from plans and 

issuers to participants and beneficiaries 

of $168.4 million annually in lower 

cost-sharing.419

9.2. Transfers From Participants, 

Beneficiaries, and Enrollees to Plans 

and Issuers Caused by Higher Premiums 

These final rules might also result in 

a transfer from participants, 

beneficiaries, and enrollees to plans and 

issuers in the form of higher premiums. 

By limiting the ability of plans and 

issuers to avoid costs of certain mental 

health and substance use disorder 

treatments while increasing access to 

and utilization of these services, these 

final rules might cause plans and issuers 

to increase premiums and change costsharing requirements (for example, by 

raising deductibles) to offset these costs. 

Similarly, plans and issuers might 

reduce the number of NQTLs employed 

and increase premiums in order to offset 

the costs of participants, beneficiaries, 

and enrollees utilizing more mental 

health and substance use disorder 

benefits. 

Many studies attempt to isolate the 

changes in health costs associated with 

implementing parity requirements. One 

2005 study by the Society of Actuaries 

on State mental health parity laws 

found that ‘‘overall health care costs 

increased minimally and in some cases 

were even reduced.’’ 420 As discussed 

earlier in section IV.8 of this regulatory 

impact analysis, by removing some of 

the barriers to access to mental health 

and substance use disorder treatments 

caused by existing NQTLs, the 

Departments expect that the final rules 

will result in increased utilization of 

mental health and substance use 

disorder services, which could increase 

costs, including premiums. However, as 

discussed in section IV.7.3 of this 

regulatory impact analysis, better access 

to mental health and substance use 

disorder services can lead to better 

health outcomes and prevent costly 

interventions, which may reduce overall 

health care costs and premiums in the 

long-term. Thus, the Departments 

anticipate that these final rules will 

have a minimal impact on premiums, 

but there may be instances in which 

plans and issuers may impose higher 

premiums. 

The Departments requested comments 

or data on this transfer in the proposal. 

A few commenters stated that the 

proposal would hinder the ability of 

plans to utilize common medical 

management techniques that improve 

cost and quality outcomes, such as prior 

authorization. As a result, commenters 

stated there would be an increase in 

premiums for participants, beneficiaries, 

and enrollees. However, as discussed 

previously, these final rules do not 

finalize the substantially all and 

predominant mathematical tests for 

NQTLs as proposed. The final rules also 

do not eliminate the use of prior 

authorization or other medical 

management, but the Departments 

emphasize that they must be designed 

and applied in parity as required by 

law. 

9.3. Transfers Between Primary Care 

Providers and Mental Health and 

Substance Use Disorder Providers 

These final rules may result in a 

transfer from primary care providers to 

mental health and substance use 

disorder providers. More specifically, 

with improved in-network access to 

mental health and substance use 

disorder providers, patients may be 

more likely to seek treatment from a 

behavioral health specialist rather than 

a primary care provider. 

For example, a 2012 study that 

examined the impact of Oregon’s 2007 

parity law on the choice of provider 

found that the law was associated with 

a slight increase in the likelihood of 

patients seeking care ‘‘with masterslevel specialists, and relatively little 

change for generalist physicians, 


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421 John K. McConnell, Samuel HN Gast, & 

Bentson H. McFarland, The Effect of 

Comprehensive Behavioral Health Parity on Choice 

of Provider, 50(6) Medical Care p. 527. 

422The study did not find a statistically 

significant change in visits to specialty mental 

health providers. See Hayley D. Germack, Coleman 

Drake, Julie M. Donohue, Ezra Golberstein, & Susan 

H. Busch, National Trends in Outpatient Mental 

Health Service Use Among Adults Between 2008 

and 2015, 71 Psychiatric Services 11 pp. 1127–1135 

(2020). 

423EBSA, FY 2022 MHPAEA Enforcement Fact 

Sheet, https://www.dol.gov/agencies/ebsa/lawsand-regulations/laws/mental-health-parity/ 

mhpaea-enforcement-2022. 

424 GAO, Mental Health and Substance Use: 

Employers’ Insurance Coverage Maintained or 

Enhanced Since Parity Act, but Effect of Coverage 

on Enrollees Varied, GAO–12–63 (Nov. 2011), 

https://www.gao.gov/assets/gao-12-63.pdf. 

425Susan L. Ettner, Jessica M. Harwood, Amber 

Thalmayer, Michael K. Ong, Haiyong Xu, & Michael 

J. Bresolin, The Mental Health Parity and Addiction 

Equity Act Evaluation Study: Impact on Specialty 

Behavioral Health Utilization and Expenditures 

among ‘‘Carve-Out’’ Enrollees, 50 Journal of Health 

Economics pp. 131–143 (2016), https://

www.ncbi.nlm.nih.gov/pmc/articles/PMC5127782. 

426Sarah Friedman, Haiyong Xu, Francisca 

Azocar, & Susan L. Ettner, Carve-out Plan Financial 

Requirements Associated with National Behavioral 

Health Parity, 55(6) Health Services Research pp. 

924–931 (2020), https://www.ncbi.nlm.nih.gov/ 

pmc/articles/PMC7704471/. 

psychiatrists, and psychologists,’’ 

leading to a shift in the use of 

nonphysician specialists and away from 

generalist physicians.421 Further, a 2020 

study compared mental health 

outpatient visits of adults in the period 

between 2008 and 2011 to the period 

between 2012 and 2015 using data from 

the MEPS–HC. Between the two time 

periods, the study found that the 

percentage of adults who visited only 

primary care non-physicians, such as 

physician assistants and nurse 

practitioners, increased by about 4 

percent, whereas the percentage of 

adults who visited only primary care 

physicians decreased by about 2 

percent.422 The findings of these papers 

suggest that the final rules may lead to 

a slight shift in the use of nonphysician 

specialists, and away from generalist 

physicians. 

9.4. Transfers Associated With the 

Implementation of the CAA, 2023 

Provision That Sunsets the MHPAEA 

Opt-Out Election for Self-Funded NonFederal Governmental Plans 

HHS anticipates that the rules 

implementing the CAA, 2023 provision 

that sunsets the MHPAEA opt-out 

election for self-funded non-Federal 

governmental plans will have similar 

effects as the other provisions examined 

in this section IV.9 of the regulatory 

impact analysis. These final rules are 

generally expected to lead to improved 

coverage of and lower cost-sharing 

requirements for mental health and 

substance use disorder benefits for 

participants and beneficiaries of selffunded non-Federal governmental 

plans. This will lead to lower out-ofpocket costs for plan participants and 

beneficiaries who receive mental health 

or substance use disorder services, 

which will be a transfer from selffunded non-Federal governmental plans 

to participants and beneficiaries. 

On the other hand, as noted in section 

IV.8.2 of this regulatory impact analysis, 

if the final rules cause plans to remove 

limits on or offer more generous mental 

health and substance use disorder 

benefits, utilization of mental health 

and substance use disorder services may 

increase, which may cause in the 

number of claims submitted, the 

number of claims paid, and the overall 

costs incurred by plans to also increase. 

This, in turn, might lead to higher 

contributions and/or deductibles for 

plan participants, which may seem to be 

a transfer from plan participants to selffunded non-Federal governmental 

plans, but is instead an indication of the 

societal cost presented in section IV.8 of 

this regulatory impact analysis (and 

who bears it). 

10. Uncertainty 

It is unclear what percentage of plans 

and issuers impose greater burdens on 

mental health and substance use 

disorder benefits than on medical/ 

surgical benefits. This frequency may 

differ among small and large plans and 

issuers. The Departments’ experience in 

enforcing MHPAEA shows that plans 

and issuers are not in full compliance 

with MHPAEA, although the extent 

across all plans and issuers is not 

known. As documented in the fiscal 

year (FY) 2022 MHPAEA Enforcement 

Fact Sheet, DOL closed investigations 

on 145 health plans, with 86 of them 

subject to MHPAEA, in fiscal year 2022. 

Of these closed investigations, EBSA 

cited 18 MHPAEA violations in 11 

investigations.423

One commenter stated that the new 

requirements of the comparative 

analyses would require plans to make 

significant changes to their benefits 

design and NQTL compliance structure, 

which could result in more restrictions 

on medical/surgical benefits and/or 

higher premiums. The commenter did 

not provide any data or evidence. The 

Departments note that there is no 

evidence from previous parity 

requirements that such actions led to 

the implementation of new NQTLs, 

particularly to medical/surgical benefits, 

and impacted cost sharing, medical 

management provisions, or medical/ 

surgical coverage. 

There is also the possibility that some 

plans and issuers will stop offering 

mental health and substance use 

disorder benefits. In 2010, 2 percent of 

employers reported discontinuing their 

coverage of both mental health and 

substance use disorder treatments or 

only substance use disorder treatments 

since MHPAEA was passed.424

Nevertheless, as discussed in section 

IV.9.1 of this regulatory impact analysis, 

the Departments anticipate that these 

final rules will expand the level of 

coverage for mental health and 

substance use disorder benefits, which 

will result in reduced out-of-pocket 

spending for plan participants, 

beneficiaries, and enrollees. 

Another commenter also stated that 

the proposed rules would largely 

eliminate behavioral health carve-out 

vendors as a business model, because 

such vendors would not be able to build 

networks in complete alignment with 

medical/surgical disorder networks, as 

required under the proposed network 

composition NQTL rule. In response, 

the Departments note that similar 

claims—that MHPAEA would eliminate 

behavioral health carve-outs—were 

made when MHPAEA was first enacted 

in 2008. Furthermore, studies have 

found that the number of carve-out 

plans have increased since the 

enactment of MHPAEA. A 2016 study 

examined the impact of MHPAEA on 

carve-out plans and found that 

MHPAEA ‘‘led to a proliferation of 

plans and heterogeneity in benefit 

design in the post-parity period among 

employer groups choosing to retain the 

carve-out model for their behavioral 

health coverage.’’ The study also found 

no evidence that carve-out plans 

dropped coverage altogether for 

behavioral health treatments.425 A 2020 

study also observing the impact of 

MHPAEA on carve-out plans found that 

‘‘post-MHPAEA, the number of carveout plans increased relative to carveins’’ and that MHPAEA was associated 

with lower copayments and out-ofnetwork coinsurance for emergency 

room and outpatient services. The 

findings suggest that MHPAEA led to 

more generous benefits for carve-out 

plans. However, the authors also noted 

an increase in deductibles and innetwork outpatient coinsurance, 

suggesting that some patients 

experienced higher out-of-pocket 

costs.426 Nevertheless, these studies 

suggest that the purported issues 

referenced by commenters were 

surmountable. 

Additionally, the Departments note 

that they are not finalizing the proposed 


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427 Ioana Popovici, Johanna Catherine Maclean, & 

Michael T. French, The Effects of Health Insurance 

Parity Laws for Substance Use Disorder Treatment 

on Traffic Fatalities: Evidence of Unintended 

Benefits, National Bureau of Economic Research 

(2017), https://www.nber.org/system/files/working_

papers/w23388/revisions/w23388.rev0.pdf?sy=388. 

428 Keshob Sharma, Do Mental Health Parity Laws 

Reduce Crime?, working paper (Nov. 14, 2021). 

special rule for NQTLs related to 

network composition, and are instead 

including language in these final rules 

to explain how plans and issuers are 

expected to comply with the relevant 

data evaluation requirements with 

respect to those NQTLs. Under these 

final rules, material differences in 

access to mental health and substance 

use disorder benefits as compared to 

medical/surgical benefits (including for 

NQTLs related to network composition) 

will not be treated as a violation; 

instead, plans and issuers must take 

reasonable action, as necessary, to 

address any material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, and 

document those actions in their 

comparative analyses. 

Further, there may be some possible 

societal spillover effects which may 

occur as a result of these final rules such 

as improving public safety in the longterm from an increase in access to 

mental health and substance use 

disorder treatments. For example, a 

2017 study examined the effect of State 

parity laws for substance use disorder 

treatments on fatal traffic accidents and 

found that enactment of State parity 

laws were associated with reduced 

annual total traffic fatality rates from 4.1 

percent to 5.4 percent.427 Furthermore, 

a 2021 study which examined the 

impact of State parity laws on crime 

between 1994 and 2010 found that the 

enactment of State parity laws was 

associated with a reduction of violent 

crimes by 5 percent to 7 percent and 

that the resulting lower crime rates were 

associated with an annual savings of $3 

billion.428 These studies suggest that the 

benefits of these final rules may go 

beyond the listed benefits discussed in 

this regulatory impact analysis. 

The Departments face uncertainty in 

estimating the magnitude of savings for 

participants, beneficiaries, and 

enrollees. The Departments requested 

comments and data in the proposal 

related to how the Departments may 

quantify the impact in out-of-pocket 

spending from these rules, but did not 

receive any comments. 

Additionally, HHS is unable to 

precisely forecast how many 

participants and beneficiaries will be 

affected by the amendments to 

implement the CAA, 2023 provision 

that sunsets the MHPAEA opt-out 

election for self-funded non-Federal 

governmental plans, as plan sponsors 

that have elected to opt out of 

requirements under MHPAEA were not 

required to report that information to 

HHS as part of their opt-out filings. See 

section IV.5.3 of this regulatory impact 

analysis for further discussion on the 

affected participants and beneficiaries. 

It is possible that some self-funded 

non-Federal governmental plans will 

stop offering mental health and 

substance use disorder benefits in 

response to the final rules. However, 

HHS is unable to estimate the potential 

number of self-funded non-Federal 

governmental plans that might do so. It 

is also possible that some self-funded 

non-Federal governmental plans might 

increase the financial requirements and 

treatment limitations that apply to 

medical/surgical benefits in response to 

this provision, to ensure that financial 

requirements and treatment limitations 

applicable to mental health and 

substance use disorder benefits comply 

with MHPAEA and its implementing 

regulations. HHS anticipates that this is 

a less likely outcome of these 

amendments. 

HHS solicited comments on the 

potential number of self-funded nonFederal governmental plans that might 

stop offering mental health and 

substance use disorder benefits, as well 

as the potential number of self-funded 

non-Federal governmental plans that 

might increase financial requirements 

and treatment limitations for medical/ 

surgical benefits in response to the 

proposed amendments. HHS also 

solicited comments on the potential 

number of participants and beneficiaries 

that might be affected by these potential 

plan changes. HHS did not receive any 

comments that provided this 

information. 

11. Alternatives 

In addition to the regulatory approach 

outlined in these final rules, the 

Departments considered alternatives 

when developing policy regarding the 

implementation of MHPAEA. The 

Departments considered not expressly 

incorporating the statutory requirement 

that NQTLs be no more restrictive for 

mental health and substance use 

disorder benefits than for medical/ 

surgical benefits. However, as described 

earlier in this preamble, it is clear that 

plans and issuers too often fail to 

consider the impact of their NQTLs on 

access to mental health and substance 

use disorder benefits before designing 

and applying NQTLs, in a manner that 

is consistent with MHPAEA’s 

fundamental purpose. While the 

Departments have seen some 

improvements in response to their 

reviews of plans’ and issuers’ 

comparative analyses under the CAA, 

2021 requirements, they have primarily 

seen a great deal of confusion about the 

application of the current regulation to 

NQTLs and about the parity obligation 

generally. Based on the experience with 

plans’ and issuers’ attempts to comply 

with the existing regulations and 

guidance and the CAA, 2021, the 

Departments have concluded that the 

existing MHPAEA regulations failed to 

sufficiently focus attention on the 

obligation to ensure that NQTLs, and 

associated processes, strategies, 

evidentiary standards, and other factors 

avoid placing disparate burdens on 

participants’, beneficiaries’, and 

enrollees’ access to mental health and 

substance use disorder benefits as 

compared to medical/surgical benefits. 

Accordingly, the Departments are of the 

view that these final rules will be 

beneficial to participants, beneficiaries, 

and enrollees, as plans and issuers 

revise their policies and remove or 

amend NQTLs that are inconsistent with 

MHPAEA. 

The Departments also considered not 

requiring plans and issuers to use 

specific data elements in designing and 

applying NQTLs and preparing their 

comparative analyses or to provide the 

data to the Departments upon request. 

However, during their review of 

comparative analyses as part of their 

reporting requirements to Congress, the 

Departments found that many plans and 

issuers did not initially provide 

sufficient information to demonstrate 

compliance of an NQTL as written, in 

operation, or both. It is often difficult to 

assess compliance in operation without 

such data. By requiring the 

consideration, use, and production of 

this data, the regulation will improve 

the review of plans’ and issuers’ policies 

and processes, and improved parity 

outcomes for participants, beneficiaries, 

and enrollees. 

12. Conclusion 

The Departments expect that these 

final rules will provide plans and 

issuers with a better understanding of 

the requirements of MHPAEA and 

improve how they measure, analyze, 

document, and demonstrate parity with 

regard to NQTLs. The Departments are 

of the view that these final rules will 

help plans and issuers produce NQTL 

comparative analyses that meet the 

requirements of the CAA, 2021, 

resulting in improved access to and 

coverage of mental health and substance 

use disorder treatments, which should 


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ultimately result in better health 

outcomes among those with mental 

health conditions and substance use 

disorders. 

V. Paperwork Reduction Act 

1. Paperwork Reduction Act— 

Departments of Labor and the Treasury 

In accordance with the Paperwork 

Reduction Act of 1995 (PRA 95) (44 

U.S.C. 3506(c)(2)(A)), the Departments 

solicited comments concerning the 

information collection requests (ICRs) 

included in the proposed rules. At the 

same time, the Departments also 

submitted ICRs to OMB, in accordance 

with 44 U.S.C. 3507(d). 

The Departments received comments 

that specifically addressed the 

paperwork burden analysis of the ICRs 

contained in the proposed rules. Many 

commenters expressed concern that the 

Departments underestimated the burden 

of collecting the required data, the 

burden required in conducting the 

substantially all and predominant 

variation analysis, the number of NQTLs 

that would need to be analyzed for each 

plan and issuer, and the amount of time 

that it would take to conduct those 

analyses. The Departments reviewed 

these public comments in developing 

the paperwork burden analysis 

discussed here. 

The changes made by these final rules 

affect the existing OMB control number, 

1210–0138. A copy of the ICR for OMB 

Control Number 1210–0138 may be 

obtained by contacting the PRA 

addressee listed in the following 

sentence or at www.RegInfo.gov. For 

additional information contact, U.S. 

Department of Labor, Employee Benefits 

Security Administration, Office of 

Research and Analysis, Attention: PRA 

Officer, 200 Constitution Avenue NW, 

Room N–5718, Washington, DC 20210; 

or send to ebsa.opr@dol.gov. 

1.1. Final Amendments to Existing 

MHPAEA Regulations (26 CFR 54.9812– 

1; 29 CFR 2590.712) 

These final rules add new definitions, 

amend existing definitions, specify new 

requirements related to NQTLs, 

including by prohibiting discriminatory 

factors and evidentiary standards, 

amend existing examples illustrating the 

rules for NQTLs, and add new examples 

illustrating the rules for NQTLs, 

providing clarity to interested parties. 

The final rules also specify that the way 

a plan or issuer defines mental health 

benefits, substance use disorder 

benefits, and medical/surgical benefits 

must be consistent with generally 

recognized independent standards of 

current medical practice and add more 

specificity as to what conditions or 

disorders plans and issuers must treat as 

mental health conditions, substance use 

disorders, and medical conditions and 

surgical procedures. The final rules also 

require that plans and issuers provide 

meaningful benefits for covered mental 

health conditions or substance use 

disorders in each classification in which 

meaningful medical/surgical benefits 

are provided. Additionally, these final 

rules require plans and issuers to collect 

and evaluate relevant data in a manner 

reasonably designed to assess the 

impact of the NQTL on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits. 

Where the relevant data suggest that the 

NQTL contributes to material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits 

in a classification, plans and issuers are 

required to take reasonable action, as 

necessary, to address the material 

differences to ensure compliance, in 

operation, with 26 CFR 54.9812–1(c)(4), 

29 CFR 2590.712(c)(4), and 45 CFR 

146.136(c)(4). These final rules provide 

guidance for how to comply with the 

relevant data evaluation requirements in 

limited circumstances where data is 

initially and temporarily unavailable for 

new and newly imposed NQTLs and 

where no data exists that can reasonably 

measure any relevant impact of the 

NQTL on relevant outcomes related to 

access to mental health and substance 

use disorder benefits and medical/ 

surgical benefits. In those instances, the 

plan or issuer must include specific 

information in their comparative 

analyses, as explained earlier in this 

preamble. However, as explained earlier 

in this preamble, the Departments are of 

the view that nearly all NQTLs will 

have some relevant data to collect and 

evaluate; therefore, the Departments 

estimate the burden as if every plan and 

issuer performs the data analysis. 

1.2. New Regulation (26 CFR 54.9812– 

2; 29 CFR 2590.712–1) 

These final rules set more specific 

content and data requirements for the 

NQTL comparative analyses required by 

MHPAEA as amended by the CAA, 

2021, clarify when the comparative 

analyses need to be performed, and 

outline the timeframes and process for 

plans and issuers to provide their 

comparative analyses to the 

Departments or applicable State 

authority upon request. 

For the purpose of this analysis, it is 

assumed that health insurance issuers 

will fulfill the data request for fully 

insured group health plans. This burden 

is accounted for under HHS’ OMB 

Control number 0938–1393 and is 

discussed later in this document. It is 

also assumed that TPAs and other 

service providers will fulfill the 

requirements for the vast majority of 

self-funded group health plans. 

1.3. Burden Estimates for Final Rules 

Requirements 

The final rules will affect self-funded 

plans and MEWAs. The Departments 

estimate that 709 self-funded plans with 

500 or more participants will prepare 

the comparative analysis and data 

themselves. The Departments also 

estimate that 4,076 self-funded plans 

with 500 or more participants will 

receive a generic comparative analysis 

from their TPA or other service 

provider, which they will subsequently 

customize to suit their specific needs. 

Finally, the Departments estimate that 

132 plan MEWAs and 21 non-plan 

MEWAs that are not fully insured will 

provide assistance to plans in collecting 

and analyzing the data, and generating 

the comparative analyses. For more 

information on how the number of each 

type of entity is estimated, please refer 

to the Affected Entities section of the 

regulatory impact analysis. 

Non-grandfathered, fully insured 

ERISA plans with less than 50 

participants that are subject to MHPAEA 

under the EHB requirements of the ACA 

are likely to have their issuers prepare 

their comparative analyses. Issuers can 

take advantage of economies of scale by 

preparing the required documents for 

those plans purchasing coverage. HHS 

has jurisdiction over issuers in States 

that substantially fail to enforce 

MHPAEA’s requirements and therefore 

is accounting for this portion of the 

burden in its analysis, in addition to the 

burden related to non-Federal 

governmental plans. Accordingly, this 

analysis considers only the burden 

associated with ERISA self-funded 

group health plans, which are under the 

jurisdiction of the DOL and the 

Treasury. 

These final rules require that a plan 

or issuer perform and document a 

comparative analysis of each NQTL 

applicable to mental health and 

substance use disorder benefits. In the 

proposed rules, the Departments 

estimated that, on average, plans would 

need to analyze four separate NQTLs 

and issuers would need to analyze eight 

NQTLs to satisfy their additional 

comparative analysis requirements. The 

Departments further estimated that 

plans and issuers preparing their own 

comparative analyses would incur a 

burden of 20 hours per NQTL in the first 

year, with 4 hours for a general or 


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77694 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

429The wage rate of an attorney, actuary, and data 

analyst is, respectively, $165.71, $177.11, and 

$159.61. (Internal DOL calculation based on 2024 

labor cost data. For a description of DOL’s 

methodology for calculating wage rates, see EBSA, 

Labor Cost Inputs Used in the Employee Benefits 

Security Administration, Office of Policy and 

Research’s Regulatory Impact Analyses and 

Paperwork Reduction Act Burden Calculations 

(June 2019), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/rules-and-regulations/ 

technical-appendices/labor-cost-inputs-used-inebsa-opr-ria-and-pra-burden-calculations-june2019.pdf.) The composite wage rate is estimated in 

the following manner: [$165.71 × (1 ÷ 3) + $159.61 

× (1 ÷ 3) × $177.61 × (1 ÷ 3) = $167.48]. 

operations manager to review the 

requirements and outline the changes 

needed for the comparative analyses 

and 16 hours for a business operations 

specialist to prepare the comparative 

analyses. Once the comparative analyses 

are performed and documented, the 

Departments estimated that plans and 

issuers would need to update the 

analyses when making changes to the 

terms of the plan or coverage, including 

changes to the way NQTLs are applied 

to mental health and substance use 

disorder benefits as well as medical and 

surgical benefits. In subsequent years, 

the Departments estimated plans would 

incur a burden of 10 hours annually per 

NQTL to update the analyses, with 2 

hours for a general or operations 

manager and 8 hours for a business 

operations specialist. 

In response to commenters’ concerns 

that the Departments underestimated 

the number of NQTLs that each plan or 

issuer would need to create comparative 

analyses for, and that plans and issuers 

would on average have the same 

number NQTLs, the Departments have 

revised their assumptions to 10 NQTLs 

for both plans and issuers. One 

commenter proposed the average 

number of NQTLs should be more than 

15 at a minimum, while another noted 

that there were at least 15 NQTLs 

referenced in the proposed rules and 

other guidance. However, given that the 

number of NQTLs vary by issuer and 

plan, that most plans will not have 

every NQTL referenced in the proposed 

rules and other guidance (although 

some might have more), and that NQTLs 

can be counted as an umbrella group, 

the Departments assume 10 NQTLs. 

The Departments assume that 

collecting the data, and reviewing and 

revising the comparative analyses 

would require 60 hours per NQTL in the 

first year and 12 hours per NQTL in 

subsequent years. For plans that receive 

a generic comparative analysis that will 

require customizing to suit the plan’s 

specific needs, the Departments assume 

that it will take 30 hours per NQTL in 

the first year and 6 hours per NQTL in 

subsequent years. While plans and 

issuers can use other professionals to 

fulfill their requirements, for purposes 

of developing the wage estimate, the 

Departments assume that it will take a 

team of data analysts, actuaries, and 

attorneys to collect the data and prepare 

the comparative analyses and have 

estimated a composite wage rate of 

$167.48.429 See Table 11 for calculations 

and burden totals. 

TABLE 11—HOUR BURDEN TO FULFILL THE DATA REQUIREMENTS AND PREPARE THE COMPARATIVE ANALYSES

Number of 

entities 

Number of 

NQTLs 

per entity 

Number of 

hours per 

NQTL for 

data and 

comparative 

analysis 

Total hour 

burden 

Hourly 

wage 

Equivalent cost 

of hour burden 

(A) (B) (C) (A × B × C) (D) E (A × B × C × D) 

First Year 

TPAs .............................................................................................................. 103 10 60 61,800 $167.48 $10,350,264 

Self-funded plans with more than 500 participants that will conduct the 

comparative analysis themselves .............................................................. 709 10 60 425,400 167.48 71,245,992 

Self-funded plans with more than 500 participants that will receive generic 

comparative analyses from TPAs or service providers, and will then 

customize it ................................................................................................ 4,076 10 30 1,222,800 167.48 204,794,544 

Plan MEWAs that are not fully insured ......................................................... 132 10 60 79,200 167.48 13,264,416 

Non-plan MEWAs that are not fully insured ................................................. 21 10 60 12,600 167.48 2,110,248 

First-year Total ....................................................................................... 5,041 .................... .................... 1,801,800 .............. 301,765,464 

Subsequent Years 

TPAs .............................................................................................................. 103 10 12 12,360 167.48 2,070,053 

Self-funded plans with more than 500 participants that will conduct the 

comparative analysis themselves .............................................................. 709 10 12 85,080 167.48 14,249,198

Self-funded plans with more than 500 participants that will receive generic 

comparative analyses from TPAs or service providers, and will then 

customize it ................................................................................................ 4,076 10 6 244,560 167.48 40,958,909 

Plan MEWAs that are not fully insured ......................................................... 132 10 12 15,840 167.48 2,652,883

Non-plan MEWAs that are not fully insured ................................................. 21 10 12 2,520 167.48 422,050 

Subsequent Years Total ........................................................................ 5,041 .................... .................... 360,360 .............. 60,353,093 

Total (3-year average) .................................................................... 5,041 .................... .................... 840,840 .............. 140,823,883 

These final rules also require that 

group health plans offering group health 

insurance coverage must make a 

comparative analysis available upon 

request by the Departments. The CAA, 

2021 requires the Departments to collect 

no fewer than 20 comparative analyses 

per year, but it also provides that the 

Departments shall request that a group 

health plan or issuer submit the 

comparative analyses for plans that 

involve potential MHPAEA violations or 

complaints regarding noncompliance 

with MHPAEA that concern NQTLs, 

and any other instances in which the 

Departments determine appropriate. 

Based on its prior experience and 

current funding, DOL expects to request 

20 comparative analyses each year. See 

Table 12 for calculations and burden 

totals. 


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430According to data from NTIA, 37.4 percent of 

individuals aged 25 and over have access to the 

internet at work. According to a Greenwald & 

Associates survey, 84 percent of plan participants 

find it acceptable to make electronic delivery the 

default option, which is used as the proxy for the 

number of participants who will not opt out of 

electronic disclosure that are automatically enrolled 

(for a total of 31.4 percent receiving electronic 

disclosure at work). Additionally, the NTIA reports 

that 44.1 percent of individuals aged 25 and over 

have access to the internet outside of work. 

According to a Pew Research Center survey, 61.0 

percent of internet users use online banking, which 

is used as the proxy for the number of internet users 

who will affirmatively consent to receiving 

electronic disclosures (for a total of 26.9 percent 

receiving electronic disclosure outside of work). 

Combining the 31.4 percent who will receive 

electronic disclosure at work with the 26.9 percent 

who will receive electronic disclosure outside of 

work produces a total of 58.3 percent who will 

receive electronic disclosure overall. 

431The postage for a first-class mail large 

envelope letter is $2.04 and the material cost is 

$0.05 per page. Thus, $2.04 + ($0.05 × 15 pages) = 

$2.79. 

These final rules also require plans 

and issuers to make the comparative 

analyses and other applicable 

information required by the CAA, 2021 

available upon request to participants, 

beneficiaries, and enrollees in all nongrandfathered group health plans and 

non-grandfathered group or individual 

health insurance coverage (including a 

provider or other person acting as a 

participant’s, beneficiary’s, or enrollee’s 

authorized representative) in connection 

with an adverse benefit determination, 

as well as to participants and 

beneficiaries in plans subject to ERISA. 

The Departments estimate that each 

plan will receive one request per 

covered health plan annually and that 

plans will annually incur a burden of 5 

minutes for a clerical worker to prepare 

and send the comparative analyses to 

each requesting participant or 

beneficiary. DOL also assumes that 58.3 

percent of requests will be delivered 

electronically, resulting in a de minimis 

cost.430 The remaining 41.7 percent of 

requests will be mailed at a cost of 

$2.79.431 See Table 12 for calculations 

and burden totals. 

1.4. Recordkeeping Requirement 

The Departments posit that plans and 

issuers already maintain records as part 

of their regular business practices. 

Further, ERISA section 107 includes a 

general 6-year retention requirement. 

For these reasons, the Departments 

estimate a minimal additional burden. 

The Departments estimate that, on 

average, any additional recordkeeping 

requirements will take clerical 

personnel 5 minutes annually. See 

Table 12 for calculations and burden 

totals. 

TABLE 12—HOUR AND COST BURDEN OF OTHER REQUIREMENTS

Number of 

response 

Number of 

hours per 

responses 

Total 

hour 

burden 

Wage 

rate 

Hour 

equivalent 

of cost 

burden 

Mailing 

cost per 

response 

Cost burden 

(A) (B) (A × B) (C) (A × B × C) (D) (A × D × 41.7 

percent) 

Business operations specialists prepare comparative analysis 

for audits .................................................................................... 20 1 20 137.67 2,753 0 0 

General operation managers prepare comparative analysis for 

audits ......................................................................................... 20 4 80 114.36 9,149 0 0 

Clerical workers prepare and distribute comparative analyses 

upon participant request ............................................................ 2,129,516 0.083 177,460 65.99 11,710,585 2.79 2,477,543 

Clerical workers maintain recordkeeping ...................................... 2,129,516 0.083 177,460 65.99 11,710,585 0 0 

Total ....................................................................................... 2,129,536 .................... 355,020 .............. 23,433,073 ................ 2,477,543 

1.5. Overall Summary 

In summary, the total burden 

associated with these final rules has a 3- 

year average hour burden of 1,195,860 

hours with an equivalent cost of 

$164,256,956 and a cost burden of 

$2,477,543. 

A summary of paperwork burden 

estimates follows: 

Type of Review: Revision. 

Agency: Employee Benefits Security 

Administration, U.S. Department of 

Labor; Internal Revenue Service, U.S. 

Department of the Treasury. 

Title: MHPAEA Notices. 

OMB Control Number: 1210–0138. 

Affected Public: Businesses or other 

for-profits, Not-for-profit institutions. 

Estimated Number of Respondents: 

123,1752. 

Estimated Number of Annual 

Responses: 123,1752. 

Frequency of Response: Annual. 

Estimated Total Annual Burden 

Hours: 1,195,860 (597,930 for DOL, 

597,930 for Treasury). 

Estimated Total Annual Burden Cost: 

$2,477,543 ($1,238,771 for DOL, 

$1,238,771 for Treasury). 

2. Paperwork Reduction Act— 

Department of HHS 

In accordance with the Paperwork 

Reduction Act of 1995 (PRA 95) (44 

U.S.C. 3506(c)(2)(A)), the Department 

solicited comments concerning the ICRs 

included in the proposed rules. At the 

same time, the Departments also 

submitted ICRs to OMB, in accordance 

with 44 U.S.C. 3507(d). 

The Departments received comments 

that specifically addressed the 

paperwork burden analysis of the ICRs 

contained in the proposed rules. Many 

commenters expressed concern that the 

Departments underestimated the burden 

of collecting the required data, the 

burden of conducting the substantially 

all and predominant variation analysis, 

the number of NQTLs that would need 

to be analyzed for each plan and issuer, 

and the amount of time that it would 

take to conduct those analyses. The 

Departments reviewed these public 

comments in developing the paperwork 

burden analysis discussed here. 

The changes made by these final rules 

affect the existing OMB control number, 

0938–1393. HHS will update the 

information collection to account for the 

burden related to the provisions in these 

final rules. 

2.1. Final Amendments to Existing 

MHPAEA Regulations (45 CFR 146.136) 

The amendments to the existing 

MHPAEA regulations in these final 

rules add new definitions, amend 

existing definitions, clarify the rules for 

NQTLs, including by prohibiting 

discriminatory factors and evidentiary 

standards, amend existing examples 

illustrating the rules for NQTLs, and 

add new examples illustrating the rules 

for NQTLs, providing clarity to the 

regulated community. The amendments 

also clarify that whether a condition or 

disorder is defined by the plan or issuer 

as being a mental health condition or a 

substance use disorder for purposes of 


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77696 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

MHPAEA must be consistent with 

generally recognized independent 

standards of current medical practice. 

The final rules also require that plans 

and issuers provide meaningful benefits 

for covered mental health conditions or 

substance use disorders in each 

classification in which meaningful 

medical/surgical benefits are provided. 

These final rules also require plans 

and issuers to collect and evaluate 

relevant data in a manner reasonably 

designed to assess the impact of the 

NQTL on relevant outcomes related to 

access to mental health and substance 

use disorder benefits and medical/ 

surgical benefits. Relevant data for the 

majority of NQTLs could include, as 

appropriate, but are not limited to, the 

number and percentage of claims 

denials and any other data relevant to 

the NQTL required by State law or 

private accreditation standards. 

Additionally, relevant data for NQTLs 

related to network composition could 

include, as appropriate, but are not 

limited to, in-network and out-ofnetwork utilization rates (including data 

related to provider claim submissions), 

network adequacy metrics (including 

time and distance data, and data on 

providers accepting new patients), and 

provider reimbursement rates (for 

comparable services and as 

benchmarked to a reference standard). 

2.2. New Regulations (45 CFR 146.137) 

These final rules set forth more 

specific content and data requirements 

for the NQTL comparative analyses 

required by MHPAEA as amended by 

the CAA, 2021, clarify when the 

comparative analyses need to be 

performed, and outline the timeframes 

and process for plans and issuers to 

provide their comparative analyses to 

the Departments or an applicable State 

authority upon request. 

These final rules provide guidance for 

how to comply with the relevant data 

evaluation requirements in limited 

circumstances where data is initially 

and temporarily unavailable for new 

and newly imposed NQTLs and where 

no data exists that can reasonably 

measure any relevant impact of the 

NQTL on relevant outcomes related to 

access to mental health and substance 

use disorder benefits and medical/ 

surgical benefits. In those instances, the 

plan or issuer must include specific 

information in their comparative 

analyses, as explained earlier in this 

preamble. In such instances, providing 

this justification is likely to be less 

expensive than the estimated burden for 

doing an analysis when there is data. 

However, as explained earlier in this 

preamble, the Departments are of the 

view that nearly all NQTLs will have 

some relevant data to collect and 

evaluate; therefore, the Departments 

estimate the burden as if every plan and 

issuer performs the data analysis. 

As discussed earlier in this preamble, 

HHS enforces applicable provisions of 

Title XXVII of the PHS Act, including 

the provisions added by MHPAEA, with 

respect to health insurance issuers 

offering group and individual health 

insurance coverage in States that elect 

not to enforce or fail to substantially 

enforce MHPAEA or another PHS Act 

provision. HHS is therefore accounting 

for this portion of the burden in its 

analysis, in addition to accounting for 

the burden on sponsors of self-funded 

non-Federal governmental plans. 

2.3. Burden Estimates for Final 

Requirements 

These final rules will affect issuers, 

TPAs, and self-funded non-Federal 

governmental plans. Health insurance 

issuers offering individual or group 

health insurance coverage usually have 

multiple products offered in multiple 

States. HHS estimates a total of 479 

health insurance companies offering 

individual or group health insurance 

coverage nationwide, with a total of 

1,467 issuers (health insurance 

company/State combinations). In 

addition, there are an estimated 205 

TPAs that provide services to group 

health plans, particularly for self-funded 

plans where TPAs often establish 

provider networks and adjudicate 

claims, which will be impacted by these 

final rules. Furthermore, sponsors of 

self-funded non-Federal governmental 

plans will be affected by these final 

rules. HHS estimates that out of the 

estimated 32,901 self-funded nonFederal governmental plans, 505 selffunded non-Federal governmental plans 

with 500 or more participants will 

prepare the comparative analysis and 

data themselves, and 2,906 self-funded 

non-Federal governmental plans with 

500 or more participants will receive a 

generic comparative analysis from their 

TPA, which they will subsequently 

customize to suit their specific needs. 

For more information on how the 

number of each type of entity is 

estimated, please refer to section IV.5.2 

of the regulatory impact analysis. 

These final rules require that a plan 

or issuer perform and document a 

comparative analysis of each NQTL 

applicable to mental health and 

substance use disorder benefits. In the 

proposed rules, the Departments 

estimated that, on average, plans would 

need to analyze four separate NQTLs 

and issuers would need to analyze eight 

NQTLs to satisfy their additional 

comparative analysis requirements. The 

Departments further estimated that 

plans and issuers preparing their own 

comparative analyses would incur a 

burden of 20 hours per NQTL in the first 

year, with 4 hours for a general or 

operations manager to review the 

requirements and outline the changes 

needed for the comparative analyses 

and 16 hours for a business operations 

specialist to prepare the comparative 

analyses. Once the comparative analyses 

are performed and documented, plans 

and issuers would need to update the 

analyses when making changes to the 

terms of the plan or coverage, including 

changes to the way NQTLs are applied 

to mental health and substance use 

disorder benefits, as well as medical and 

surgical benefits. In subsequent years, 

the Departments estimated plans would 

incur a burden of 10 hours annually per 

NQTL to update the analyses, with 2 

hours for a general or operations 

manager and 8 hours for a business 

operations specialist. 

In response to commenters’ concerns 

that the Departments underestimated 

the number of NQTLs that each plan or 

issuer would need to create comparative 

analyses for, and that plans and issuers 

would on average have the same 

number NQTLs, the Departments have 

revised their assumptions to 10 NQTLs 

for both plans and issuers. One 

commenter proposed the average 

number of NQTLs should be more than 

15 at a minimum, while another noted 

that there were at least 15 NQTLs 

referenced in the proposed rules and 

other guidance. However, because the 

number of NQTLs varies by issuer and 

plan, most plans will not have every 

NQTL referenced in the rules or 

guidance (although some might use 

more), and NQTLs can be counted as an 

umbrella group, the Departments 

assume 10 NQTLs. 

The Departments assume that 

collecting the data, and reviewing and 

revising the comparative analyses will 

require 60 hours per NQTL in the first 

year and 12 hours per NQTL in 

subsequent years. For plan sponsors that 

receive a generic comparative analysis 

from a TPA that will require 

customizing to suit the plan’s specific 

needs, the Departments assume that it 

will take 30 hours per NQTL in the first 

year and 6 hours per NQTL in 

subsequent years. While plans and 

issuers can use other professionals to 

fulfill their requirements, for purposes 

of developing the wage estimate, the 

Departments assume that it will take a 

team of data analysts, actuaries, and 

attorneys to collect the data and prepare 

the comparative analyses, and have 

estimated a composite wage rate of 


khammond on DSKJM1Z7X2PROD with RULES2
Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77697 

432The wage rate of an attorney, actuary, and data 

analyst is, respectively, $165.71, $177.11, and 

$159.61. (Internal DOL calculation based on 2024 

labor cost data. For a description of DOL’s 

methodology for calculating wage rates, see EBSA, 

Labor Cost Inputs Used in the Employee Benefits 

Security Administration, Office of Policy and 

Research’s Regulatory Impact Analyses and 

Paperwork Reduction Act Burden Calculations 

(June 2019), https://www.dol.gov/sites/dolgov/files/ 

EBSA/laws-and-regulations/rules-and-regulations/ 

technical-appendices/labor-cost-inputs-used-inebsa-opr-ria-and-pra-burden-calculations-june2019.pdf.) The composite wage rate is estimated in 

the following manner: [$165.71 × (1 ÷ 3) + $159.61 

× (1 ÷ 3) × $177.61 × (1 ÷ 3) = $167.48]. 

433According to data from NTIA, 37.4 percent of 

individuals aged 25 and over have access to the 

internet at work. According to a Greenwald & 

Associates survey, 84 percent of plan participants 

find it acceptable to make electronic delivery the 

default option, which is used as the proxy for the 

number of participants who will not opt out of 

electronic disclosure that are automatically enrolled 

(for a total of 31.4 percent receiving electronic 

disclosure at work). Additionally, the NTIA reports 

that 44.1 percent of individuals aged 25 and over 

have access to the internet outside of work. 

According to a Pew Research Center survey, 61.0 

percent of internet users use online banking, which 

is used as the proxy for the number of internet users 

who will affirmatively consent to receiving 

electronic disclosures (for a total of 26.9 percent 

receiving electronic disclosure outside of work). 

Combining the 31.4 percent who will receive 

electronic disclosure at work with the 26.9 percent 

who will receive electronic disclosure outside of 

work produces a total of 58.3 percent who will 

receive electronic disclosure overall. 

434The postage for a first-class mail large 

envelope is $2.04 and the material cost is $0.05 per 

page. Thus, $2.04 + ($0.05 × 15 pages) = $2.79. 

$167.48.432 See Table 13 for calculations 

and burden totals. 

TABLE 13—HOUR BURDEN TO FULFILL THE DATA REQUIREMENTS AND PREPARE THE COMPARATIVE ANALYSES

Number of 

entities 

Number of 

NQTLs 

per entity 

Number of 

hours per 

NQTL for 

data and 

comparative 

analysis 

Total hour 

burden 

Hourly 

wage 

Equivalent 

cost of 

hour burden 

(A) (B) (C) (A × B × C) (D) E (A × B × C × D) 

First Year 

Issuers (health insurance company/State combinations) ............................. 1,467 10 60 880,200 $167.48 $147,415,896 

TPAs .............................................................................................................. 103 10 60 61,800 167.48 10,350,264 

Self-funded non-Federal governmental plans with more than 500 participants that will conduct the comparative analysis themselves .................. 505 10 60 303,000 167.48 50,746,440 

Self-funded non-Federal governmental plans with more than 500 participants that will receive a generic comparative analysis from TPAs or 

service providers, and will then customize it ............................................ 2,906 10 30 871,800 167.48 146,009,064

First-year Total ....................................................................................... 4,981 .................... .................... 2,116,800 .............. 354,521,664 

Subsequent Years 

Issuers ........................................................................................................... 1,467 10 12 176,040 167.48 29,483,179 

TPAs .............................................................................................................. 103 10 12 12,360 167.48 2,070,053 

Self-funded non-Federal governmental plans with more than 500 participants that will conduct the comparative analysis themselves .................. 505 10 12 60,600 167.48 10,149,288 

Self-funded non-Federal governmental plans with more than 500 participants that will receive a generic comparative analysis from TPAs or 

service providers, and will then customize it ............................................ 2,906 10 6 174,360 167.48 29,201,813 

Subsequent Years Total ........................................................................ 4,981 .................... .................... 423,360 .............. 70,904,333 

Total (3-year average) .................................................................... 4,981 .................... .................... 987,840 .............. 165,443,443 

These final rules require that plans or 

issuers make their comparative analyses 

available upon request to the 

Departments. The CAA, 2021 requires 

the Departments to collect not fewer 

than 20 comparative analyses per year, 

but it also provides that the 

Departments shall request that a plan or 

issuer submit the comparative analyses 

for plans that involve potential 

MHPAEA violations or complaints 

regarding noncompliance with 

MHPAEA that concern NQTLs, and any 

other instances in which the 

Departments determine appropriate. 

HHS expects to request at least 20 

comparative analyses each year. See 

Table 14 for calculations and burden 

totals. 

These final rules also require plans 

and issuers to make the comparative 

analyses and other applicable 

information required by the CAA, 2021 

available upon request to participants, 

beneficiaries, and enrollees in all nongrandfathered group health plans and 

non-grandfathered group or individual 

health insurance coverage (including a 

provider or other person acting as a 

participant’s, beneficiary’s, or enrollee’s 

authorized representative) in connection 

with an adverse benefit determination, 

as well as to participants and 

beneficiaries in plans subject to ERISA. 

HHS estimates that each non-Federal 

governmental plan and each issuer will 

receive one request annually and that 

plans and issuers will annually incur a 

burden of 5 minutes for a clerical 

worker to prepare and send the 

comparative analyses to each requesting 

participant, beneficiary, or enrollee. 

HHS also assumes that 58.3 percent of 

requests will be delivered electronically, 

resulting in a de minimis cost.433 The 

remaining 41.7 percent of requests will 

be mailed.434 The annual cost burden to 

mail the comparative analyses to the 

participants and beneficiaries will 

therefore be approximately $107,500. 

See Table 14 for calculations and 

burden totals. 

2.4. Recordkeeping Requirement 

HHS posits that plans and issuers 

already maintain records as part of their 

regular business practices. HHS 

therefore estimates a minimal additional 

burden associated with these final rules. 

HHS estimates that each non-Federal 

governmental plan and issuer will 

annually incur a burden of 5 minutes, 

on average. See Table 14 for calculations 

and burden totals. 

HHS will revise the information 

collection approved under OMB Control 


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435CMS–10773, Non-Quantitative Treatment 

Limitation Analyses and Compliance Under 

MHPAEA. 

436Based on the HIPAA opt-out filings, sponsors 

of 46 self-funded non-Federal governmental plans 

permissibly opt out of other requirements 

(standards relating to benefits for mothers and 

newborns, required coverage for reconstructive 

surgery following mastectomies, and/or coverage of 

dependent students on medically necessary leave of 

absence). 

437This includes the time required by the 

individual signing the certification to conduct a 

thorough review of the election contents. 

438See Office of Personnel Management, 2024 

General Schedule (GS) Locality Pay Tables, https:// 

www.opm.gov/policy-data-oversight/pay-leave/ 

salaries-wages/salary-tables/pdf/2024/DCB_h.pdf. 

439This estimate is calculated as follows: 185 

plans × 261 participants per plan on average = 

48,285 notices in total. 

440CMS–10430, Information Collection 

Requirements for Compliance with Individual and 

Group Market Reforms under Title XXVII of the 

Public Health Service Act. 

Number 0938–1393 to account for this 

burden.435

TABLE 14—HOUR AND COST BURDEN OF OTHER REQUIREMENTS

Number of 

responses 

Number of 

hours per 

response 

Total 

hour 

burden 

Wage 

rate 

Hour 

equivalent 

of cost 

burden 

Mailing 

cost per 

response 

Cost burden 

(A) (B) (A × B) (C) (A × B × C) (D) (A × D × 41.7 

percent) 

Business operations specialists prepare comparative analysis 

for audits .................................................................................... 20 4 80 $114.36 $9,149 $0 $0 

General operation managers prepare comparative analysis for 

audits ......................................................................................... 20 1 20 137.67 2,753 0 0 

Clerical workers prepare comparative analyses upon participant 

request ....................................................................................... 92,354 0.083 7,696 65.99 507,859 2.79 107,477 

Clerical workers maintain recordkeeping ...................................... 92,354 0.083 7,696 65.99 507,859 0 0 

Total ....................................................................................... 92,374 .................... 15,492 .............. 1,027,620 ................ 107,477 

2.5. ICRs Regarding the Self-Funded 

Non-Federal Governmental Plan OptOut Provisions (45 CFR 146.180) 

2.5.1. Notice to Federal Government of 

Self-Funded Non-Federal Governmental 

Plan Opt-Out: Plan Burden Reduction— 

Preparation and Processing of Opt-Out 

Election Notice 

The regulatory amendments to 

implement a provision in the CAA, 2023 

that sunsets the election option for 

sponsors of self-funded non-Federal 

governmental plans to opt out of 

requirements under MHPAEA eliminate 

the need for sponsors to submit a notice 

to the Federal Government regarding 

their plan’s opt-out election (or, for 

sponsors of multiple plans, their plans’ 

opt-out elections), as long as the 

sponsors do not elect to permissibly opt 

out of other requirements.436 HHS 

estimates that sponsors of 185 plans will 

no longer need to submit a notice to the 

Federal Government regarding their 

plan’s opt-out election. HHS estimates 

that for each self-funded non-Federal 

governmental plan whose sponsor has 

elected to opt out of the requirements, 

a compensation and benefits manager 

will need 15 minutes annually to fill out 

and electronically submit the model 

notification form to HHS.437 See Table 

14 for calculations and cost savings. 

These amendments also generate cost 

savings for the Federal Government, as 

HHS will no longer have to process the 

opt-out notices submitted by plan 

sponsors. The processing of the opt-out 

notices is performed by an HHS 

employee. The average labor rate for the 

employee who completes this task, 

which includes the locality pay 

adjustment for the area of WashingtonBaltimore-Arlington, and the cost of 

fringe benefits and other indirect costs, 

is $113.04 per hour for a GS–13, step 1 

employee.438 HHS estimates that on 

average it takes an HHS employee 15 

minutes to process an opt-out notice 

submitted by a plan sponsor. See Table 

15 for calculations and cost savings. 

2.5.2. Notice to Plan Participants of SelfFunded Non-Federal Governmental Plan 

Opt-Out: Plan Burden Reduction— 

Preparation and Processing of Opt-Out 

Election Notice 

The regulatory amendments to 

implement the provision in the CAA, 

2023 that sunsets the election option for 

sponsors of self-funded non-Federal 

governmental plans to opt out of 

requirements under MHPAEA also 

eliminate the need for those sponsors to 

prepare and disseminate an opt-out 

notice to plan participants regarding 

their plan sponsors’ opt-out election, as 

long as the sponsors do not elect to 

permissibly opt out of other 

requirements. HHS estimates that 

sponsors of 185 plans will no longer 

need to prepare and disseminate an optout notice to plan participants. HHS 

estimates that for each self-funded nonFederal governmental plan whose 

sponsor has elected to opt out of the 

requirements under MHPAEA, an 

administrative assistant will need 15 

minutes to develop and update the HHS 

standardized disclosure statement 

annually. Further, self-funded nonFederal governmental plan sponsors 

will no longer be required to print and 

mail the opt-out notice to plan 

participants and will therefore no longer 

incur costs associated with this 

requirement. As noted earlier in section 

IV.5.2 of the regulatory impact analysis, 

HHS estimates that there are 

approximately 261 participants in each 

self-funded non-Federal governmental 

plan, and therefore approximately 

48,285 notices 439 will no longer have to 

be printed and mailed. See Table 15 for 

calculations and cost savings. 

The burden related to HIPAA opt-outs 

is currently approved under OMB 

Control Number 0938–0702.440 HHS 

will update the information collection 

to account for this burden reduction. 


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441 5 U.S.C. 601 et seq. (1980). 

442 5 U.S.C. 604 (1980). 

443 2022 MHPAEA Report to Congress, https://

www.dol.gov/sites/dolgov/files/EBSA/laws-andregulations/laws/mental-health-parity/report-tocongress-2022-realizing-parity-reducing-stigmaand-raising-awareness.pdf; 2023 MHPAEA 

Comparative Analysis Report to Congress, 

www.dol.gov/sites/dolgov/files/EBSA/laws-andregulations/laws/mental-health-parity/report-tocongress-2023-mhpaea-comparative-analysis.pdf. 

TABLE 15—COST SAVINGS OF PREPARING AND DISTRIBUTING OPT-OUT ELECTION NOTICE

Number of 

responses 

Number of 

hours per 

entity 

Total hour 

burden 

Wage 

rate 

Mailing 

cost per 

response 

Cost savings 

(A) (B) (A × B) (C) (D) (A × B × C) or 

(A × D) 

General operation managers preparing and processing of opt-out election 

notice to Federal Government ................................................................... 185 0.25 46 $131.14 .................... $6,032 

Clerical workers preparing and processing of opt-out election notice to 

plan participants ........................................................................................ 185 0.25 46 42.58 .................... 1,959 

Clerical workers distributing opt-out election notice to plan participants ..... 48,285 .................... .................... .................... $0.05 2,414 

Total ....................................................................................................... 48,470 .................... 92 .................... .................... 10,405 

2.6. Overall Summary 

In summary, the total new burden 

imposed by these final rules regarding 

NQTL comparative analyses and 

compliance, has a 3-year average hour 

burden of approximately 1,003,332 

hours with an equivalent cost of 

approximately $166,471,063 and a total 

cost burden of approximately $107,447. 

The final amendments to implement the 

CAA, 2023 provision that sunsets the 

MHPAEA opt-out election for sponsors 

of self-funded non-Federal 

governmental plans will result in an 

annual burden reduction of 

approximately 92 hours with an 

equivalent annual cost savings of 

approximately $7,991 and total cost 

savings of approximately $10,405. 

A summary of the change in 

paperwork burden estimates follows: 

Type of Review: Revision. 

Agency: Centers for Medicare & 

Medicaid Services, U.S. Department of 

Health and Human Services. 

Title: Non-Quantitative Treatment 

Limitation Analyses and Compliance 

Under MHPAEA. 

OMB Control Number: 0938–1393. 

Affected Public: Businesses or other 

for-profits, Not-for-profit institutions, 

State, Local, or Tribal Governments. 

Estimated Number of Respondents: 

92,457. 

Estimated Number of Annual 

Responses: 189,709. 

Frequency of Response: Annual. 

Estimated Total Annual Burden 

Hours: 1,003,332. 

Estimated Total Annual Burden Cost: 

$107,447. 

Title: Requirements for Compliance 

with Individual and Group Market 

Reforms under Title XXVII of the Public 

Health Service Act. 

OMB Control Number: 0938–0702. 

Affected Public: State, Local, or Tribal 

Governments. 

Estimated Number of Respondents: 

(185). 

Estimated Number of Annual 

Responses: (185). 

Frequency of Response: Annual. 

Estimated Total Annual Burden 

Hours: (92). 

Estimated Total Annual Burden Cost: 

($2,414). 

Note: Numbers in parentheses denote a 

burden reduction. 

VI. Regulatory Flexibility Act 

The Regulatory Flexibility Act 

(RFA) 441 imposes certain requirements 

with respect to Federal rules that are 

subject to the notice-and-comment 

requirements of section 553(b) of the 

Administrative Procedure Act and are 

likely to have a significant economic 

impact on a substantial number of small 

entities. Unless the head of an agency 

determines that a final rule is not likely 

to have a significant economic impact 

on a substantial number of small 

entities, section 604 442 of the RFA 

requires the agency to present a final 

regulatory flexibility analysis of these 

final rules. 

The Departments certify that these 

final rules will not have a significant 

impact on a substantial number of small 

entities. The Departments have prepared 

the following justification for this 

determination. 

1. Need for and Objectives of the Rule 

As documented in the 2022 MHPAEA 

Report to Congress and the 2023 

MHPAEA Comparative Analysis Report 

to Congress,443 the Departments found 

that none of the NQTL comparative 

analyses they reviewed upon initial 

receipt contained sufficient information 

and documentation. 

These final rules clarify existing 

definitions, add new definitions of key 

terms, and provide additional examples 

of the application of MHPAEA to 

NQTLs to improve the understanding 

and ability of the regulated community 

to comply with MHPAEA. The final 

rules also clarify that plan and issuer 

definitions of conditions or disorders as 

mental health conditions and substance 

use disorders must be consistent with 

generally recognized independent 

standards of current medical practice 

and add more specificity as to what 

plans and issuers must treat as mental 

health conditions or substance use 

disorders. The final rules also require 

that plans and issuers must provide 

meaningful benefits for covered mental 

health conditions or substance use 

disorders in each such classification in 

which medical/surgical benefits are 

provided. These final rules also require 

plans and issuers to collect and evaluate 

relevant data in a manner reasonably 

designed to assess the impact of the 

NQTL on access to mental health and 

substance use disorder benefits and 

medical/surgical benefits. Relevant data 

for the majority of NQTLs could 

include, as appropriate, but are not 

limited to, the number and percentage 

of claims denials and any other data 

relevant to the NQTL as required by 

State law or private accreditation 

standards. Additionally, for NQTLs 

related to network composition, relevant 

data could include, as appropriate, but 

are not limited to, in-network and outof-network utilization rates (including 

data related to provider claim 

submissions), network adequacy metrics 

(including time and distance data, and 

data on providers accepting new 

patients), and provider reimbursement 

rates (for comparable services and as 

benchmarked to a reference standard). 

Under these final rules, the Departments 

may specify the type, form, and manner 

for the relevant data evaluation 

requirements in future guidance, which 

will allow the Departments to adjust the 

data requirements as needed to account 

for enforcement experience and 

industry trends. 

These final rules also set more 

specific content requirements for 


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444The Departments estimate that there are 

140,998 ERISA-covered group health plans with 50 

to 100 participants based on the MEPS–IC and the 

2020 County Business Patterns from the Census 

Bureau. The Departments also estimate that 75 

percent of ERISA-covered group health plans with 

50 to 100 participants are fully insured based on 

assumptions referencing these same data. Thus, the 

Departments have calculated the number of fully 

insured plans with 50 to 100 participants in the 

following manner: 140,998 ERISA-covered group 

health plans with 50 to 100 participants × 75 

percent = 105,749. 

445The Departments estimate that there are 

2,465,483 ERISA-covered group health plans with 

less than 50 participants based on data from the 

2022 MEPS–IC and the 2020 County Business 

Patterns from the Census Bureau. The Departments 

also estimate that 83 percent of group health plans 

with less than 50 participants are fully insured 

based on data from the 2022 MEPS–IC. The 2020 

KFF Employer Health Benefits Survey reported that 

in 2020, 16 percent of firms offering health benefits 

offered at least one grandfathered health plan; 

therefore, the Departments assume the percent of 

firms offering at least one non-grandfathered health 

plan is 84 percent (100 percent¥16 percent). KFF, 

2020 Employer Health Benefits Survey (Oct. 8, 

2020), https://files.kff.org/attachment/ReportEmployer-Health-Benefits-2020-Annual-Survey.pdf. 

Thus, the Departments have calculated the number 

of fully insured, non-grandfathered plans with less 

than 50 participants in the following manner: 

2,465,483 small ERISA-covered group health plans 

× 83 percent × 84 percent = 1,718,935. 

446Estimates based on the 2021 Form 5500 data. 

447Based on the 2022 Census of Governments, 

there are 90,887 non-Federal governmental plans. 

Based on the 2022 MEPS–IC, the Departments 

estimate that 36.2 percent of non-Federal 

governmental plans are self-funded Thus, 90,887 

plans × 36.2 percent = 32,901 self-funded nonFederal governmental plans. Based on the 2021 

Form 5500 data, the Departments estimate that 54.6 

percent of self-funded health plans with less than 

100 participants have filed the Form 5500. The 

Departments use the percent of self-funded health 

plans with less than 100 participants that have filed 

a Form 5500 as a proxy for the percent of selffunded non-Federal governmental plans with less 

than 100 participants. Thus, 32,901 self-funded 

non-Federal governmental plans × 54.6 percent = 

17,964 self-funded non-Federal governmental plans 

with less than 100 participants. 

448The Departments’ estimate of the number of 

health insurance issuers are based on MLR reports 

submitted by issuers for the 2022 reporting year. 

CMS, Medical Loss Ratio Data and System 

Resources (2022), https://www.cms.gov/CCIIO/ 

Resources/Data-Resources/mlr. 

449SBA, Table of Size Standards, https://

www.sba.gov/document/support--table-sizestandards, as of March 2023. 

450CMS, Medical Loss Ratio Data and System 

Resources (2022), https://www.cms.gov/CCIIO/ 

Resources/Data-Resources/mlr.html. 

comparative analyses required by the 

CAA, 2021, clarify when a comparative 

analysis needs to be performed and for 

which NQTLs, and outline the process 

for plans and issuers to provide their 

comparative analyses to the 

Departments upon request. 

The Departments expect that these 

final rules will result in plans and 

issuers having a better understanding of 

the MHPAEA requirements for NQTLs. 

These final rules will also improve the 

manner in which parity is measured, 

compared, and demonstrated by plans 

and issuers. The Departments are of the 

view that these final rules will improve 

the compliance of plans and issuers 

with these requirements, resulting in 

greater parity in access to benefits for 

mental health conditions and substance 

use disorders as compared with 

medical/surgical benefits, as intended 

by MHPAEA. 

Additionally, in these final rules, 

HHS finalizes regulatory amendments to 

implement a provision in the CAA, 2023 

that sunsets the election option for 

sponsors of self-funded non-Federal 

governmental plans to opt out of 

requirements under MHPAEA. HHS is 

of the view that these regulatory 

amendments will ultimately increase 

access to mental health and substance 

use disorder services, and increase 

parity of benefits for such services as 

compared to benefits for medical/ 

surgical services by requiring selffunded non-Federal governmental plans 

that had previously opted out to come 

into compliance with the requirements 

under MHPAEA. 

2. Affected Small Entities 

For purposes of analysis under the 

RFA, the Departments consider 

employee benefit plans with fewer than 

100 participants to be small entities. 

The basis of this definition is found in 

section 104(a)(2) of ERISA, which 

permits the Secretary of Labor to 

prescribe simplified annual reports for 

plans that cover fewer than 100 

participants. Under section 104(a)(3) of 

ERISA, the Secretary of Labor may also 

provide for exemptions or simplified 

annual reporting and disclosure for 

welfare benefit plans. Under the 

authority of section 104(a)(3), DOL has 

previously issued (see 29 CFR 

2520.104–20, 2520.104–21, 2520.104– 

41, 2520.104–46, and 2520.104b–10) 

simplified reporting provisions and 

limited exemptions from reporting and 

disclosure requirements for small plans, 

including unfunded or insured welfare 

plans, that cover fewer than 100 

participants and satisfy certain 

requirements. While some large 

employers have small plans, small plans 

are maintained generally by small 

employers. Thus, the Departments are of 

the view that assessing the impact of 

these final rules on small plans is an 

appropriate substitute for evaluating the 

effect on small entities. The definition 

of small entity considered appropriate 

for this purpose differs, however, from 

the definition of small business based 

on size standards (revenue or number of 

employees) issued by the Small 

Business Administration (SBA) under 

the Small Business Act. 

As discussed in section IV.5.2 of the 

regulatory impact analysis, these final 

rules will affect nearly all small ERISAcovered group health plans, including 

fully insured group health plans and 

self-funded group health plans, as well 

as small health insurance issuers and 

non-Federal governmental plans. The 

Departments estimate that these final 

rules will affect approximately 106,000 

fully insured plans with 50 to 100 

participants,444 and approximately 

1,719,000 fully insured, nongrandfathered plans with less than 50 

participants.445

The Departments also estimate that 

approximately 25,300 self-funded plans 

with less than 100 participants will be 

affected by these final rules.446

Additionally, the Departments estimate 

that approximately 18,000 self-funded 

non-Federal governmental plans with 

less than 100 participants will also be 

affected by these final rules.447 The 

Departments assume that these small, 

self-funded plans will receive assistance 

with the comparative analyses and data 

requirements from TPAs or other service 

providers involved with the plan. Due 

to many small plans using identical 

insurance products, these small plans 

are not expected to be significantly 

impacted as costs are spread across 

many small plans. 

As discussed in section IV.5.1 of the 

regulatory impact analysis, these final 

rules will also affect health insurance 

issuers. The Departments estimate that 

these final rules will affect 479 health 

insurance companies nationwide that 

provide mental health and substance 

use disorder benefits in the group and 

individual health insurance markets, 

with a total of 1,467 issuers (health 

insurance company/State 

combinations).448

Health insurance companies are 

generally classified under the North 

American Industry Classification 

System (NAICS) code 524114 (Direct 

Health and Medical Insurance Carriers). 

According to SBA size standards, 

entities with average annual receipts of 

$47 million or less are considered small 

entities for this NAICS code.449 The 

Departments expect that few, if any, 

health insurance companies 

underwriting health insurance policies 

fall below these size thresholds. Based 

on data from MLR annual report 

submissions for the 2022 MLR reporting 

year, approximately 87 out of 487 health 

insurance companies (of which 479 are 

impacted by these final rules) had total 

premium revenue of $47 million or 

less.450 However, it should be noted that 

at least 76 percent of these small 

companies belong to larger holding 

groups that may not be small, and many, 


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if not all, of these companies are likely 

to have non-health lines of business that 

would result in their revenues 

exceeding $47 million. 

The amendments to implement the 

CAA, 2023 provision that sunsets the 

MHPAEA opt-out election will affect 

sponsors of self-funded non-Federal 

governmental plans, some of which 

might be small entities. As noted in 

section IV.8.4 of the regulatory impact 

analysis, the extent to which these plans 

are out of compliance is unknown, and 

the costs for them to come into 

compliance are expected to vary from 

plan to plan. HHS solicited comments 

in the proposal on the number of small 

entities that would be impacted by the 

implementation of the sunset provision 

and the potential effects on small 

entities. HHS did not receive any 

comments on these estimates. 

2.1. Amendments to Existing MHPAEA 

Regulation (26 CFR 54.9812–1, 29 CFR 

2590.712, and 45 CFR 146.136) 

These final rules clarify existing 

definitions, add new definitions, 

generally ensure that the NQTLs 

applicable to mental health and 

substance use disorder benefits are 

generally no more restrictive than the 

predominant NQTLs applied to 

substantially all medical/surgical 

benefits, and provide additional 

examples of the application of MHPAEA 

to NQTLs to improve the understanding 

and ability of the regulated community 

to comply with MHPAEA. These final 

rules also clarify that mental health 

benefits and substance use disorder 

benefits must be defined to be 

consistent with generally recognized 

independent standards of current 

medical practice and add more 

specificity as to what plans and issuers 

must define as mental health conditions 

or substance use disorders. The final 

rules also require that plans and issuers 

must provide meaningful benefits for 

covered mental health conditions or 

substance use disorders in each 

classification in which medical/surgical 

benefits are provided. These final rules 

also require plans and issuers to collect 

and evaluate relevant data and include 

an analysis of the data as part of each 

comparative analysis. The Departments 

are of the view that plans and issuers 

will incur costs in collecting, preparing, 

and analyzing the data. 

The Departments are of the view that 

the final amendments might cause small 

plans and issuers to revise their policies 

and remove treatment limitations. 

Therefore, small plans and issuers could 

incur costs to revise plan provisions, 

which may result in increased costs 

from expanded utilization of mental 

health and substance use disorder 

services. The Departments face 

uncertainty in quantifying these costs as 

they cannot estimate the increase in 

utilization and which services may see 

the largest increase in utilization. 

2.2. New Regulations (26 CFR 54.9812– 

2, 29 CFR 2590.712–1, and 45 CFR 

146.137 and 146.180) 

These final rules codify existing 

guidance, set more specific content 

requirements for comparative analyses 

required by the CAA, 2021, and outline 

the timeframes and process for plans 

and issuers to provide their comparative 

analyses to the Departments upon 

request. Participants and beneficiaries 

in ERISA plans may also request a copy 

of comparative analyses at any time, and 

all participants, beneficiaries, and 

enrollees may request a comparative 

analysis in connection with an adverse 

benefit determination. Additionally, in 

these final rules, HHS finalizes 

regulatory amendments to implement 

the provision in the CAA, 2023 that 

sunsets the election option for selffunded non-Federal governmental plans 

to opt out of requirements under 

MHPAEA. 

In the first year, the Departments 

estimate that TPAs, MEWAs, issuers, 

and self-funded group health plans, 

most if not all of which are large 

entities, will conduct the comparative 

analysis themselves will incur an 

incremental per-entity cost of 

approximately $101,600 associated with 

these final rules. The Departments also 

estimate an incremental per-entity cost 

of $51,300 in the first year for selffunded group health plans that will 

receive a generic comparative analysis 

from their TPA or other service provider 

and subsequently will customize to suit 

their specific needs. 

In the subsequent years, the 

Departments estimate that TPAs, 

MEWAs, issuers, and self-funded group 

health plans that will conduct the 

comparative analysis themselves, will 

incur an incremental per-entity cost of 

approximately $20,100 associated with 

these final rules and amendments. The 

Departments also estimate an 

incremental per-entity cost of $10,100 in 

subsequent years for self-funded group 

health plans that will receive a generic 

comparative analysis from their TPA or 

other service provider and subsequently 

will customize it to suit their specific 

needs. 

The Departments note that these perentity costs are average costs, and these 

costs are expected to vary by plan or 

issuer depending on the number of 

NQTL analyses performed. 

3. Comment Summary 

In the proposal, commenters 

expressed concerns that the 

Departments underestimated the burden 

of collecting the required data and 

performing the comparative analyses. 

One commenter stated that small plans 

lack access to aggregated claims data. 

The same commenter suggested that the 

proposal was burdensome, since it 

required information that was beyond 

the possession of small plans. The 

commenter contended that small 

employers may decide to stop offering 

health coverage altogether in favor of 

having their employees purchase their 

own individual health insurance 

coverage through the ACA Exchange, 

stating that the penalties under the ACA 

for employers not offering coverage may 

be preferable compared to the costly 

requirements under the proposal. The 

Departments note that there are no such 

penalties that apply to small employers. 

The commenter also did not provide 

any data or evidence. 

Another commenter stated that there 

is a limited market of vendors for 

conducting the comparative analyses, 

mentioning that these services could 

cost upwards of $100,000. The same 

commenter expressed concern that the 

proposal’s comparative analysis 

requirements would disproportionately 

consume the health benefits budget of 

plan sponsors, potentially causing small 

employers to discontinue offering 

mental health and substance use 

disorder benefits. The Departments note 

that while there is a possibility that 

some plans and issuers will stop 

offering mental health and substance 

use disorder benefits, the Departments 

anticipate that these final rules will 

expand the level of coverage for mental 

health and substance use disorder 

benefits, which will result in reduced 

out-of-pocket spending for plan 

participants, beneficiaries, and 

enrollees. The Departments also note 

that the commenter did not cite any data 

or evidence. 

Furthermore, another commenter was 

concerned that the proposal would 

disrupt the operations of plans, by 

forcing plans to change their network 

composition and eliminate the use of 

common medical management 

techniques. The same commenter stated 

that the burden would fall on small 

plans, since they may have insufficient 

resources to cope with this 

unanticipated cost burden. The 

commenter did not provide any data or 

evidence to support these assertions. As 

discussed earlier in this preamble, these 

final rules do not eliminate the use of 

prior authorization or other medical 


khammond on DSKJM1Z7X2PROD with RULES2
77702 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

451 2 U.S.C. 1501 et seq. (1995). 

452 Federalism, 64 FR 153 (Aug. 4, 1999). 

management techniques, but emphasize 

that they must be developed and used 

in parity as required by law. 

Finally, the Departments did not 

receive any comments from the Chief 

Counsel for Advocacy of SBA. 

4. Duplicate, Overlapping, or Relevant 

Federal Rules 

There are no duplicate, overlapping, 

or relevant Federal rules. 

VII. Special Analyses—Department of 

the Treasury 

Under the Memorandum of 

Agreement, Review of Treasury 

Regulations under Executive Order 

12866 (June 9, 2023), tax regulatory 

actions issued by the Internal Revenue 

Service (IRS) are not subject to the 

requirements of section 6 of Executive 

Order 12866, as amended. Therefore, a 

regulatory impact analysis is not 

required. As required by section 7805(f) 

of the Code, these regulations were 

submitted to the Chief Counsel for 

Advocacy of SBA for comment on their 

impact on small business. 

VIII. Unfunded Mandates Reform Act 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA) requires 

each Federal agency to prepare a written 

statement assessing the effects of any 

Federal mandate in a proposed or final 

agency rule that may result in an 

expenditure of $100 million or more 

(adjusted annually for inflation with the 

base year 1995) in any one year by State, 

local, and Tribal governments, in the 

aggregate, or by the private sector.451

For purposes of the UMRA, this 

rulemaking is expected to have such an 

impact. For the purposes of this 

rulemaking, the regulatory impact 

analysis shall meet the UMRA 

obligations. 

IX. Federalism Statement 

Executive Order 13132 outlines 

fundamental principles of federalism, 

and requires the adherence to specific 

criteria by Federal agencies in the 

process of their formulation and 

implementation of policies that have 

‘‘substantial direct effects’’ on the 

States, the relationship between the 

Federal Government and States, or on 

the distribution of power and 

responsibilities among the various 

levels of government.452 Federal 

agencies promulgating regulations that 

have federalism implications must 

consult with State and local officials 

and describe the extent of their 

consultation and the nature of the 

concerns of State and local officials in 

the preamble to these final rules. 

In the Departments’ view, these final 

rules have federalism implications 

because they will have direct effects on 

the States, on the relationship between 

the Federal Government and the States, 

and on the distribution of power and 

responsibilities among various levels of 

government. These final rules could also 

have federalism implications because 

the Departments remove the reference to 

State guidelines in the definitions of 

medical/surgical benefits, mental health 

benefits, and substance use disorder 

benefits, and amend these definitions to 

provide that any condition or procedure 

defined by the plan or coverage as being 

or not being a mental health condition 

or substance use disorder, respectively, 

must be defined to be consistent with 

generally recognized independent 

standards of current medical practice, 

which for purposes of these final rules 

are all conditions or disorders under the 

relevant chapters of the ICD or DSM. 

Finally, these final rules have 

federalism implications because the 

implementation of the CAA, 2023 

provision that sunsets the election 

option for sponsors of self-funded nonFederal governmental plans to opt out of 

requirements under MHPAEA will 

require State and local government 

sponsors of self-funded non-Federal 

governmental plans that currently opt 

out of requirements under MHPAEA to 

come into compliance. 

In general, through section 514, 

ERISA supersedes State laws to the 

extent that they relate to any covered 

employee benefit plan, and preserves 

State laws that regulate insurance, 

banking, or securities. While ERISA 

prohibits States from regulating a plan 

as an insurance or investment company 

or bank, the preemption provisions of 

section 731 of ERISA and section 2724 

of the PHS Act (implemented in 29 CFR 

2590.731(a) and 45 CFR 146.143(a)) 

apply so that the MHPAEA 

requirements are not to be ‘‘construed to 

supersede any provision of State law 

which establishes, implements, or 

continues in effect any standard or 

requirement solely relating to health 

insurance issuers in connection with 

individual or group health insurance 

coverage except to the extent that such 

standard or requirement prevents the 

application of a requirement’’ of 

MHPAEA. The conference report 

accompanying HIPAA indicates that 

this is intended to be the ‘‘narrowest’’ 

preemption of State laws. See Conf. Rep. 

No. 104–736, pg. 205, reprinted in 1996 

U.S. Code Cong. & Admin. News 2018. 

States may continue to apply State 

law requirements except to the extent 

that such requirements prevent the 

application of the MHPAEA 

requirements that are the subject of this 

rulemaking. State insurance laws that 

are more stringent than the Federal 

requirements are unlikely to ‘‘prevent 

the application of’’ MHPAEA and be 

preempted. Accordingly, States have 

significant latitude to impose 

requirements on health insurance 

issuers that are more restrictive than the 

Federal law. 

Throughout the process of developing 

these final rules, to the extent feasible 

within the specific preemption 

provisions of HIPAA as it applies to 

MHPAEA, the Departments have 

attempted to balance the States’ 

interests in regulating health insurance 

issuers, and Congress’ intent to provide 

uniform minimum protections to 

consumers in every State. By doing so, 

it is the Departments’ view that they 

have complied with the requirements of 

Executive Order 13132. 

X. Congressional Review Act 

In accordance with Subtitle E of the 

Small Business Regulatory Enforcement 

Fairness Act of 1996 (also known as the 

Congressional Review Act, 5 U.S.C. 801 

et seq.), OIRA has determined that this 

rule meets the criteria set forth in 5 

U.S.C. 804(2). Accordingly, a report 

containing a copy of the rule along with 

other specified information has been 

submitted to each House of the Congress 

and to the Comptroller General. 

List of Subjects 

26 CFR Part 54 

Excise taxes, Health care, Health 

insurance, Pensions, Reporting and 

recordkeeping requirements. 

29 CFR Part 2590 

Continuation coverage, Disclosure, 

Employee benefit plans, Group health 

plans, Health care, Health insurance, 

Medical child support, Reporting and 

recordkeeping requirements. 

45 CFR Part 146 

Health care, Health insurance, 

Reporting and recordkeeping 

requirements. 

45 CFR Part 147 

Aged, Citizenship and naturalization, 

Civil rights, Health care, Health 

insurance, Individuals with disabilities, 

Intergovernmental relations, Reporting 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77703 

and recordkeeping requirements, Sex 

discrimination. 

Douglas W. O’Donnell, 

Deputy Commissioner, Internal Revenue 

Service. 

Aviva Aron-Dine, 

Acting Assistant Secretary (Tax Policy), 

Department of the Treasury. 

Lisa M. Gomez, 

Assistant Secretary, Employee Benefits 

Security Administration, Department of 

Labor. 

Xavier Becerra, 

Secretary, Department of Health and Human 

Services. 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 54 

Accordingly, the Treasury Department 

and the IRS amend 26 CFR part 54 as 

follows: 

PART 54—PENSION EXCISE TAXES 

■ Paragraph 1. The authority citation 

for part 54 continues to read in part as 

follows: 

Authority: 26 U.S.C. 7805 * * * 

■ Par. 2. Amend § 54.9812–1 by: 

■ a. Redesignating paragraph (a) as 

paragraph (a)(2) and adding paragraphs 

(a) heading and (a)(1); 

■ b. In newly redesignated paragraph 

(a)(2): 

■ i. Revising the introductory text; 

■ ii. Adding the definitions of ‘‘DSM,’’ 

‘‘Evidentiary standards,’’ ‘‘Factors,’’ and 

‘‘ICD’’ in alphabetical order; 

■ iii. Revising the definitions of 

‘‘Medical/surgical benefits’’ and 

‘‘Mental health benefits’’; 

■ iv. Adding the definitions of 

‘‘Processes’’ and ‘‘Strategies’’ in 

alphabetical order; and 

■ v. Revising the definitions of 

‘‘Substance use disorder benefits’’ and 

‘‘Treatment limitations’’; 

■ c. Revising paragraphs (c)(1)(ii), 

(c)(2)(i), (c)(2)(ii)(A) introductory text, 

(c)(2)(ii)(C), and (c)(3)(i)(A), (C), and (D); 

■ d. In paragraph (c)(3)(iii), adding 

introductory text; 

■ e. Revising paragraphs (c)(3)(iii)(A) 

and (B), (c)(3)(iv), (c)(4), (d)(3), (e)(4), 

and (i)(1); and 

■ f. Adding paragraph (j). 

The revisions and additions read as 

follows: 

§ 54.9812–1 Parity in mental health and 

substance use disorder benefits. 

(a) Purpose and meaning of terms— 

(1) Purpose. This section and § 54.9812– 

2 set forth rules to ensure parity in 

aggregate lifetime and annual dollar 

limits, financial requirements, and 

quantitative and nonquantitative 

treatment limitations between mental 

health and substance use disorder 

benefits and medical/surgical benefits, 

as required under Code section 9812. A 

fundamental purpose of Code section 

9812, this section, and § 54.9812–2 is to 

ensure that participants and 

beneficiaries in a group health plan that 

offers mental health or substance use 

disorder benefits are not subject to more 

restrictive aggregate lifetime or annual 

dollar limits, financial requirements, or 

treatment limitations with respect to 

those benefits than the predominant 

dollar limits, financial requirements, or 

treatment limitations that are applied to 

substantially all medical/surgical 

benefits covered by the plan in the same 

classification, as further provided in this 

section and § 54.9812–2. Accordingly, 

in complying with the provisions of 

Code section 9812, this section, and 

§ 54.9812–2, plans must not design or 

apply financial requirements and 

treatment limitations that impose a 

greater burden on access (that is, are 

more restrictive) to mental health or 

substance use disorder benefits under 

the plan than they impose on access to 

medical/surgical benefits in the same 

classification of benefits. The provisions 

of Code section 9812, this section, and 

§ 54.9812–2 should be interpreted in a 

manner that is consistent with the 

purpose described in this paragraph 

(a)(1). 

(2) Meaning of terms. For purposes of 

this section and § 54.9812–2, except 

where the context clearly indicates 

otherwise, the following terms have the 

meanings indicated: 

* * * * * 

DSM means the American Psychiatric 

Association’s Diagnostic and Statistical 

Manual of Mental Disorders. For the 

purpose of this definition, the most 

current version of the DSM as of 

November 22, 2024, is the Diagnostic 

and Statistical Manual of Mental 

Disorders, Fifth Edition, Text Revision 

published in March 2022. A subsequent 

version of the DSM published after 

November 22, 2024, will be considered 

the most current version beginning on 

the first day of the plan year that is one 

year after the date the subsequent 

version is published. 

Evidentiary standards are any 

evidence, sources, or standards that a 

group health plan considered or relied 

upon in designing or applying a factor 

with respect to a nonquantitative 

treatment limitation, including specific 

benchmarks or thresholds. Evidentiary 

standards may be empirical, statistical, 

or clinical in nature, and include: 

sources acquired or originating from an 

objective third party, such as recognized 

medical literature, professional 

standards and protocols (which may 

include comparative effectiveness 

studies and clinical trials), published 

research studies, payment rates for 

items and services (such as publicly 

available databases of the ‘‘usual, 

customary and reasonable’’ rates paid 

for items and services), and clinical 

treatment guidelines; internal plan data, 

such as claims or utilization data or 

criteria for assuring a sufficient mix and 

number of network providers; and 

benchmarks or thresholds, such as 

measures of excessive utilization, cost 

levels, time or distance standards, or 

network participation percentage 

thresholds. 

Factors are all information, including 

processes and strategies (but not 

evidentiary standards), that a group 

health plan considered or relied upon to 

design a nonquantitative treatment 

limitation, or to determine whether or 

how the nonquantitative treatment 

limitation applies to benefits under the 

plan. Examples of factors include, but 

are not limited to: provider discretion in 

determining a diagnosis or type or 

length of treatment; clinical efficacy of 

any proposed treatment or service; 

licensing and accreditation of providers; 

claim types with a high percentage of 

fraud; quality measures; treatment 

outcomes; severity or chronicity of 

condition; variability in the cost of an 

episode of treatment; high cost growth; 

variability in cost and quality; elasticity 

of demand; and geographic location. 

* * * * * 

ICD means the World Health 

Organization’s International 

Classification of Diseases adopted by the 

Department of Health and Human 

Services through 45 CFR 162.1002. For 

the purpose of this definition, the most 

current version of the ICD as of 

November 22, 2024, is the International 

Classification of Diseases, 10th 

Revision, Clinical Modification adopted 

for the period beginning on October 1, 

2015. Any subsequent version of the 

ICD adopted through 45 CFR 162.1002 

after November 22, 2024, will be 

considered the most current version 

beginning on the first day of the plan 

year that is one year after the date the 

subsequent version is adopted. 

Medical/surgical benefits means 

benefits with respect to items or services 

for medical conditions or surgical 

procedures, as defined under the terms 

of the group health plan and in 

accordance with applicable Federal and 

State law, but does not include mental 

health benefits or substance use 

disorder benefits. Notwithstanding the 


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preceding sentence, any condition or 

procedure defined by the plan as being 

or as not being a medical condition or 

surgical procedure must be defined 

consistent with generally recognized 

independent standards of current 

medical practice (for example, the most 

current version of the ICD). To the 

extent generally recognized 

independent standards of current 

medical practice do not address whether 

a condition or procedure is a medical 

condition or surgical procedure, plans 

may define the condition or procedure 

in accordance with applicable Federal 

and State law. 

Mental health benefits means benefits 

with respect to items or services for 

mental health conditions, as defined 

under the terms of the group health plan 

and in accordance with applicable 

Federal and State law, but does not 

include medical/surgical benefits or 

substance use disorder benefits. 

Notwithstanding the preceding 

sentence, any condition defined by the 

plan as being or as not being a mental 

health condition must be defined 

consistent with generally recognized 

independent standards of current 

medical practice. For the purpose of this 

definition, to be consistent with 

generally recognized independent 

standards of current medical practice, 

the definition must include all 

conditions covered under the plan, 

except for substance use disorders, that 

fall under any of the diagnostic 

categories listed in the mental, 

behavioral, and neurodevelopmental 

disorders chapter (or equivalent 

chapter) of the most current version of 

the ICD or that are listed in the most 

current version of the DSM. To the 

extent generally recognized 

independent standards of current 

medical practice do not address whether 

a condition is a mental health condition, 

plans may define the condition in 

accordance with applicable Federal and 

State law. 

Processes are actions, steps, or 

procedures that a group health plan uses 

to apply a nonquantitative treatment 

limitation, including actions, steps, or 

procedures established by the plan as 

requirements in order for a participant 

or beneficiary to access benefits, 

including through actions by a 

participant’s or beneficiary’s authorized 

representative or a provider or facility. 

Examples of processes include, but are 

not limited to: procedures to submit 

information to authorize coverage for an 

item or service prior to receiving the 

benefit or while treatment is ongoing 

(including requirements for peer or 

expert clinical review of that 

information); provider referral 

requirements that are used to determine 

when and how a participant or 

beneficiary may access certain services; 

and the development and approval of a 

treatment plan used in a concurrent 

review process to determine whether a 

specific request should be granted or 

denied. Processes also include the 

specific procedures used by staff or 

other representatives of a plan (or the 

service provider of a plan) to administer 

the application of nonquantitative 

treatment limitations, such as how a 

panel of staff members applies the 

nonquantitative treatment limitation 

(including the qualifications of staff 

involved, number of staff members 

allocated, and time allocated), 

consultations with panels of experts in 

applying the nonquantitative treatment 

limitation, and the degree of reviewer 

discretion in adhering to criteria 

hierarchy when applying a 

nonquantitative treatment limitation. 

Strategies are practices, methods, or 

internal metrics that a plan considers, 

reviews, or uses to design a 

nonquantitative treatment limitation. 

Examples of strategies include, but are 

not limited to: the development of the 

clinical rationale used in approving or 

denying benefits; the method of 

determining whether and how to 

deviate from generally accepted 

standards of care in concurrent reviews; 

the selection of information deemed 

reasonably necessary to make medical 

necessity determinations; reliance on 

treatment guidelines or guidelines 

provided by third-party organizations in 

the design of a nonquantitative 

treatment limitation; and rationales 

used in selecting and adopting certain 

threshold amounts to apply a 

nonquantitative treatment limitation, 

professional standards and protocols to 

determine utilization management 

standards, and fee schedules used to 

determine provider reimbursement 

rates, used as part of a nonquantitative 

treatment limitation. Strategies also 

include the method of creating and 

determining the composition of the staff 

or other representatives of a plan (or the 

service provider of a plan) that 

deliberates, or otherwise makes 

decisions, on the design of 

nonquantitative treatment limitations, 

including the plan’s methods for making 

decisions related to the qualifications of 

staff involved, number of staff members 

allocated, and time allocated; breadth of 

sources and evidence considered; 

consultations with panels of experts in 

designing the nonquantitative treatment 

limitation; and the composition of the 

panels used to design a nonquantitative 

treatment limitation. 

Substance use disorder benefits 

means benefits with respect to items or 

services for substance use disorders, as 

defined under the terms of the group 

health plan and in accordance with 

applicable Federal and State law, but 

does not include medical/surgical 

benefits or mental health benefits. 

Notwithstanding the preceding 

sentence, any disorder defined by the 

plan as being or as not being a substance 

use disorder must be defined consistent 

with generally recognized independent 

standards of current medical practice. 

For the purpose of this definition, to be 

consistent with generally recognized 

independent standards of current 

medical practice, the definition must 

include all disorders covered under the 

plan that fall under any of the 

diagnostic categories listed as a mental 

or behavioral disorder due to 

psychoactive substance use (or 

equivalent category) in the mental, 

behavioral, and neurodevelopmental 

disorders chapter (or equivalent 

chapter) of the most current version of 

the ICD or that are listed as a SubstanceRelated and Addictive Disorder (or 

equivalent category) in the most current 

version of the DSM. To the extent 

generally recognized independent 

standards of current medical practice do 

not address whether a disorder is a 

substance use disorder, plans may 

define the disorder in accordance with 

applicable Federal and State law. 

Treatment limitations include limits 

on benefits based on the frequency of 

treatment, number of visits, days of 

coverage, days in a waiting period, or 

other similar limits on the scope or 

duration of treatment. Treatment 

limitations include both quantitative 

treatment limitations, which are 

expressed numerically (such as 50 

outpatient visits per year), and 

nonquantitative treatment limitations 

(such as standards related to network 

composition), which otherwise limit the 

scope or duration of benefits for 

treatment under a plan. (See paragraph 

(c)(4)(ii) of this section for an 

illustrative, non-exhaustive list of 

nonquantitative treatment limitations.) 

A complete exclusion of all benefits for 

a particular condition or disorder, 

however, is not a treatment limitation 

for purposes of this definition. 

* * * * * 

(c) * * * 

(1) * * * 

(ii) Type of financial requirement or 

treatment limitation. When reference is 

made in this paragraph (c) to a type of 

financial requirement or treatment 

limitation, the reference to type means 

its nature. Different types of financial 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77705 

requirements include deductibles, 

copayments, coinsurance, and out-ofpocket maximums. Different types of 

quantitative treatment limitations 

include annual, episode, and lifetime 

day and visit limits. See paragraph 

(c)(4)(ii) of this section for an 

illustrative, non-exhaustive list of 

nonquantitative treatment limitations. 

* * * * * 

(2) * * * 

(i) General rule. A group health plan 

that provides both medical/surgical 

benefits and mental health or substance 

use disorder benefits may not apply any 

financial requirement or treatment 

limitation to mental health or substance 

use disorder benefits in any 

classification that is more restrictive 

than the predominant financial 

requirement or treatment limitation of 

that type applied to substantially all 

medical/surgical benefits in the same 

classification. Whether a financial 

requirement or treatment limitation is a 

predominant financial requirement or 

treatment limitation that applies to 

substantially all medical/surgical 

benefits in a classification is determined 

separately for each type of financial 

requirement or treatment limitation. A 

plan may not impose any financial 

requirement or treatment limitation that 

is applicable only with respect to 

mental health or substance use disorder 

benefits and not to any medical/surgical 

benefits in the same benefit 

classification. The application of the 

rules of this paragraph (c)(2) to financial 

requirements and quantitative treatment 

limitations is addressed in paragraph 

(c)(3) of this section; the application of 

the rules of this paragraph (c)(2) to 

nonquantitative treatment limitations is 

addressed in paragraph (c)(4) of this 

section. 

(ii) * * * 

(A) In general. If a plan provides any 

benefits for a mental health condition or 

substance use disorder in any 

classification of benefits described in 

this paragraph (c)(2)(ii), it must provide 

meaningful benefits for that mental 

health condition or substance use 

disorder in every classification in which 

medical/surgical benefits are provided. 

For purposes of this paragraph 

(c)(2)(ii)(A), whether the benefits 

provided are meaningful benefits is 

determined in comparison to the 

benefits provided for medical 

conditions and surgical procedures in 

the classification and requires, at a 

minimum, coverage of benefits for that 

condition or disorder in each 

classification in which the plan 

provides benefits for one or more 

medical conditions or surgical 

procedures. A plan does not provide 

meaningful benefits under this 

paragraph (c)(2)(ii)(A) unless it provides 

benefits for a core treatment for that 

condition or disorder in each 

classification in which the plan 

provides benefits for a core treatment for 

one or more medical conditions or 

surgical procedures. For purposes of 

this paragraph (c)(2)(ii)(A), a core 

treatment for a condition or disorder is 

a standard treatment or course of 

treatment, therapy, service, or 

intervention indicated by generally 

recognized independent standards of 

current medical practice. If there is no 

core treatment for a covered mental 

health condition or substance use 

disorder with respect to a classification, 

the plan is not required to provide 

benefits for a core treatment for such 

condition or disorder in that 

classification (but must provide benefits 

for such condition or disorder in every 

classification in which medical/surgical 

benefits are provided). In determining 

the classification in which a particular 

benefit belongs, a plan must apply the 

same standards to medical/surgical 

benefits and to mental health or 

substance use disorder benefits. To the 

extent that a plan provides benefits in 

a classification and imposes any 

separate financial requirement or 

treatment limitation (or separate level of 

a financial requirement or treatment 

limitation) for benefits in the 

classification, the rules of this paragraph 

(c) apply separately with respect to that 

classification for all financial 

requirements or treatment limitations 

(illustrated in examples in paragraph 

(c)(2)(ii)(C) of this section). The 

following classifications of benefits are 

the only classifications used in applying 

the rules of this paragraph (c), in 

addition to the permissible subclassifications described in paragraph 

(c)(3)(iii) of this section: 

* * * * * 

(C) Examples. The rules of this 

paragraph (c)(2)(ii) are illustrated by the 

following examples. In each example, 

the group health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. With regard to the 

examples in this paragraph (c)(2)(ii)(C), 

references to any particular core 

treatment are included for illustrative 

purposes only. Plans must consult 

generally recognized independent 

standards of current medical practice to 

determine the applicable core treatment, 

therapy, service, or intervention for any 

covered condition or disorder. 

(1) Example 1—(i) Facts. A group health 

plan offers inpatient and outpatient benefits 

and does not contract with a network of 

providers. The plan imposes a $500 

deductible on all benefits. For inpatient 

medical/surgical benefits, the plan imposes a 

coinsurance requirement. For outpatient 

medical/surgical benefits, the plan imposes 

copayments. The plan imposes no other 

financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(1) (Example 1), because the plan 

has no network of providers, all benefits 

provided are out-of-network. Because 

inpatient, out-of-network medical/surgical 

benefits are subject to separate financial 

requirements from outpatient, out-of-network 

medical/surgical benefits, the rules of this 

paragraph (c) apply separately with respect to 

any financial requirements and treatment 

limitations, including the deductible, in each 

classification. 

(2) Example 2—(i) Facts. A plan imposes 

a $500 deductible on all benefits. The plan 

has no network of providers. The plan 

generally imposes a 20 percent coinsurance 

requirement with respect to all benefits, 

without distinguishing among inpatient, 

outpatient, emergency care, or prescription 

drug benefits. The plan imposes no other 

financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(2) (Example 2), because the plan 

does not impose separate financial 

requirements (or treatment limitations) based 

on classification, the rules of this paragraph 

(c) apply with respect to the deductible and 

the coinsurance across all benefits. 

(3) Example 3—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(2)(i) of this section 

(Example 2), except the plan exempts 

emergency care benefits from the 20 percent 

coinsurance requirement. The plan imposes 

no other financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(3) (Example 3), because the plan 

imposes separate financial requirements 

based on classifications, the rules of this 

paragraph (c) apply with respect to the 

deductible and the coinsurance separately for 

benefits in the emergency care classification 

and all other benefits. 

(4) Example 4—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(2)(i) of this section 

(Example 2), except the plan also imposes a 

preauthorization requirement for all inpatient 

treatment in order for benefits to be paid. No 

such requirement applies to outpatient 

treatment. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(4) (Example 4), because the plan 

has no network of providers, all benefits 

provided are out-of-network. Because the 

plan imposes a separate treatment limitation 

based on classifications, the rules of this 

paragraph (c) apply with respect to the 

deductible and coinsurance separately for 

inpatient, out-of-network benefits and all 

other benefits. 

(5) Example 5—(i) Facts. A plan covers 

treatment for autism spectrum disorder 

(ASD), a mental health condition, and covers 

outpatient, out-of-network developmental 


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screenings for ASD but excludes all other 

benefits for outpatient treatment for ASD, 

including applied behavior analysis (ABA) 

therapy, when provided on an out-of-network 

basis. The plan generally covers the full 

range of outpatient treatments (including 

core treatments) and treatment settings for 

medical conditions and surgical procedures 

when provided on an out-of-network basis. 

Under the generally recognized independent 

standards of current medical practice 

consulted by the plan, developmental 

screenings alone do not constitute a core 

treatment for ASD. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(5) (Example 5), the plan violates 

the rules of this paragraph (c)(2)(ii). Although 

the plan covers benefits for ASD, in the 

outpatient, out-of-network classification, it 

only covers developmental screenings, so it 

does not cover a core treatment for ASD in 

the classification. Because the plan generally 

covers the full range of medical/surgical 

benefits including a core treatment for one or 

more medical conditions or surgical 

procedures in the classification, it fails to 

provide meaningful benefits for treatment of 

ASD in the classification. 

(6) Example 6—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(5) of this section 

(Example 5), except that the plan is an HMO 

that does not cover the full range of medical/ 

surgical benefits, including a core treatment 

for any medical conditions or surgical 

procedures in the outpatient, out-of-network 

classification (except as required under Code 

sections 9816 and 9817), but covers benefits 

for medical conditions and surgical 

procedures in the inpatient, in-network; 

outpatient, in-network; emergency care; and 

prescription drug classifications. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(6) (Example 6), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

Because the plan does not provide 

meaningful benefits, including for a core 

treatment for any medical condition or 

surgical procedure in the outpatient, out-ofnetwork classification (except as required 

under Code sections 9816 and 9817), the plan 

is not required to provide meaningful 

benefits for any mental health conditions or 

substance use disorders in that classification. 

Nevertheless, the plan must provide 

meaningful benefits for each mental health 

condition and substance use disorder for 

which the plan provides benefits in every 

classification in which meaningful medical/ 

surgical benefits are provided, as required 

under paragraph (c)(2)(ii)(A) of this section. 

This example does not address whether the 

plan has complied with other applicable 

requirements of this section in excluding 

coverage of ABA therapy in the outpatient, 

out-of-network classification. 

(7) Example 7—(i) Facts. A plan provides 

extensive benefits, including for core 

treatments for many medical conditions and 

surgical procedures in the outpatient, innetwork classification, including nutrition 

counseling for diabetes and obesity. The plan 

also generally covers diagnosis and treatment 

for eating disorders, which are mental health 

conditions, including coverage for nutrition 

counseling to treat eating disorders in the 

outpatient, in-network classification. 

Nutrition counseling is a core treatment for 

eating disorders, in accordance with 

generally recognized independent standards 

of current medical practice consulted by the 

plan. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(7) (Example 7), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

The coverage of diagnosis and treatment for 

eating disorders, including nutrition 

counseling, in the outpatient, in-network 

classification results in the plan providing 

meaningful benefits for the treatment of 

eating disorders in the classification, as 

determined in comparison to the benefits 

provided for medical conditions or surgical 

procedures in the classification. 

(8) Example 8—(i) Facts. A plan provides 

extensive benefits for the core treatments for 

many medical conditions and surgical 

procedures in the outpatient, in-network and 

prescription drug classifications. The plan 

provides coverage for diagnosis and 

treatment for opioid use disorder, a substance 

use disorder, in the outpatient, in-network 

classification, by covering counseling and 

behavioral therapies and, in the prescription 

drug classification, by covering medications 

to treat opioid use disorder (MOUD). 

Counseling and behavioral therapies and 

MOUD, in combination, are one of the core 

treatments for opioid use disorder, in 

accordance with generally recognized 

independent standards of current medical 

practice consulted by the plan. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(8) (Example 8), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

The coverage of counseling and behavioral 

therapies and MOUD, in combination, in the 

outpatient, in-network classification and 

prescription drug classification, respectively, 

results in the plan providing meaningful 

benefits for the treatment of opioid use 

disorder in the outpatient, in-network and 

prescription drug classifications. 

(3) * * * 

(i) * * * 

(A) Substantially all. For purposes of 

this paragraph (c)(3), a type of financial 

requirement or quantitative treatment 

limitation is considered to apply to 

substantially all medical/surgical 

benefits in a classification of benefits if 

it applies to at least two-thirds of all 

medical/surgical benefits in that 

classification. (For purposes of this 

paragraph (c)(3)(i)(A), benefits 

expressed as subject to a zero level of a 

type of financial requirement are treated 

as benefits not subject to that type of 

financial requirement, and benefits 

expressed as subject to a quantitative 

treatment limitation that is unlimited 

are treated as benefits not subject to that 

type of quantitative treatment 

limitation.) If a type of financial 

requirement or quantitative treatment 

limitation does not apply to at least twothirds of all medical/surgical benefits in 

a classification, then that type cannot be 

applied to mental health or substance 

use disorder benefits in that 

classification. 

* * * * * 

(C) Portion based on plan payments. 

For purposes of this paragraph (c)(3), 

the determination of the portion of 

medical/surgical benefits in a 

classification of benefits subject to a 

financial requirement or quantitative 

treatment limitation (or subject to any 

level of a financial requirement or 

quantitative treatment limitation) is 

based on the dollar amount of all plan 

payments for medical/surgical benefits 

in the classification expected to be paid 

under the plan for the plan year (or for 

the portion of the plan year after a 

change in plan benefits that affects the 

applicability of the financial 

requirement or quantitative treatment 

limitation). 

(D) Clarifications for certain threshold 

requirements. For any deductible, the 

dollar amount of plan payments 

includes all plan payments with respect 

to claims that would be subject to the 

deductible if it had not been satisfied. 

For any out-of-pocket maximum, the 

dollar amount of plan payments 

includes all plan payments associated 

with out-of-pocket payments that are 

taken into account towards the out-ofpocket maximum as well as all plan 

payments associated with out-of-pocket 

payments that would have been made 

towards the out-of-pocket maximum if it 

had not been satisfied. The rules of this 

paragraph (c)(3)(i)(D) apply for any 

other thresholds at which the rate of 

plan payment changes. (See also PHS 

Act section 2707 and Affordable Care 

Act section 1302(c), which establish 

annual limitations on out-of-pocket 

maximums for all non-grandfathered 

health plans.) 

* * * * * 

(iii) Special rules. Unless specifically 

permitted under this paragraph 

(c)(3)(iii), sub-classifications are not 

permitted when applying the rules of 

paragraph (c)(3) of this section. 

(A) Multi-tiered prescription drug 

benefits. If a plan applies different levels 

of financial requirements to different 

tiers of prescription drug benefits based 

on reasonable factors determined in 

accordance with the rules in paragraph 

(c)(4) of this section (relating to 

requirements for nonquantitative 

treatment limitations) and without 

regard to whether a drug is generally 

prescribed with respect to medical/ 

surgical benefits or with respect to 

mental health or substance use disorder 

benefits, the plan satisfies the parity 

requirements of this paragraph (c) with 

respect to prescription drug benefits. 

Reasonable factors include cost, 


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efficacy, generic versus brand name, and 

mail order versus pharmacy pick-up. 

(B) Multiple network tiers. If a plan 

provides benefits through multiple tiers 

of in-network providers (such as an innetwork tier of preferred providers with 

more generous cost-sharing to 

participants than a separate in-network 

tier of participating providers), the plan 

may divide its benefits furnished on an 

in-network basis into sub-classifications 

that reflect network tiers, if the tiering 

is based on reasonable factors 

determined in accordance with the rules 

in paragraph (c)(4) of this section (such 

as quality, performance, and market 

standards) and without regard to 

whether a provider provides services 

with respect to medical/surgical benefits 

or mental health or substance use 

disorder benefits. After the subclassifications are established, the plan 

may not impose any financial 

requirement or treatment limitation on 

mental health or substance use disorder 

benefits in any sub-classification that is 

more restrictive than the predominant 

financial requirement or treatment 

limitation that applies to substantially 

all medical/surgical benefits in the subclassification using the methodology set 

forth in paragraph (c)(3)(i) of this 

section. 

* * * * * 

(iv) Examples. The rules of 

paragraphs (c)(3)(i) through (iii) of this 

section are illustrated by the following 

examples. In each example, the group 

health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. 

(A) Example 1—(1) Facts. (i) For 

inpatient, out-of-network medical/ 

surgical benefits, a group health plan 

imposes five levels of coinsurance. 

Using a reasonable method, the plan 

projects its payments for the upcoming 

year as follows: 

TABLE 1 TO PARAGRAPH (c)(3)(iv)(A)(1)(i) 

Coinsurance rate .............................. 0% .......... 10% .............................. 15% .............................. 20% .............................. 30% .............................. Total 

Projected payments .......................... $200x ..... $100x ........................... $450x ........................... $100x ........................... $150x ........................... $1,000x 

Percent of total plan costs ............... 20% ........ 10% .............................. 45% .............................. 10% .............................. 15%.

Percent subject to coinsurance level N/A ......... 12.5% (100x/800x) ...... 56.25% (450x/800x) .... 12.5% (100x/800x) ...... 18.75% (150x/800x).

(ii) The plan projects plan costs of $800x 

to be subject to coinsurance ($100x + $450x 

+ $100x + $150x = $800x). Thus, 80 percent 

($800x/$1,000x) of the benefits are projected 

to be subject to coinsurance, and 56.25 

percent of the benefits subject to coinsurance 

are projected to be subject to the 15 percent 

coinsurance level. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(A) (Example 1), the two-thirds 

threshold of the substantially all standard is 

met for coinsurance because 80 percent of all 

inpatient, out-of-network medical/surgical 

benefits are subject to coinsurance. Moreover, 

the 15 percent coinsurance is the 

predominant level because it is applicable to 

more than one-half of inpatient, out-ofnetwork medical/surgical benefits subject to 

the coinsurance requirement. The plan may 

not impose any level of coinsurance with 

respect to inpatient, out-of-network mental 

health or substance use disorder benefits that 

is more restrictive than the 15 percent level 

of coinsurance. 

(B) Example 2—(1) Facts. (i) For 

outpatient, in-network medical/surgical 

benefits, a plan imposes five different 

copayment levels. Using a reasonable 

method, the plan projects payments for the 

upcoming year as follows: 

TABLE 2 TO PARAGRAPH (c)(3)(iv)(B)(1)(i) 

Copayment amount .......................... $0 ........... $10 ............................... $15 ............................... $20 ............................... $50 ............................... Total 

Projected payments .......................... $200x ..... $200x ........................... $200x ........................... $300x ........................... $100x ........................... $1,000x 

Percent of total plan costs ............... 20% ........ 20% .............................. 20% .............................. 30% .............................. 10% ..............................

Percent subject to copayments ........ N/A ......... 25% (200x/800x) ......... 25% (200x/800x) ......... 37.5% (300x/800x) ...... 12.5% (100x/800x) ......

(ii) The plan projects plan costs of $800x 

to be subject to copayments ($200x + $200x 

+$300x + $100x = $800x). Thus, 80 percent 

($800x/$1,000x) of the benefits are projected 

to be subject to a copayment. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(B) (Example 2), the two-thirds 

threshold of the substantially all standard is 

met for copayments because 80 percent of all 

outpatient, in-network medical/surgical 

benefits are subject to a copayment. 

Moreover, there is no single level that applies 

to more than one-half of medical/surgical 

benefits in the classification subject to a 

copayment (for the $10 copayment, 25%; for 

the $15 copayment, 25%; for the $20 

copayment, 37.5%; and for the $50 

copayment, 12.5%). The plan can combine 

any levels of copayment, including the 

highest levels, to determine the predominant 

level that can be applied to mental health or 

substance use disorder benefits. If the plan 

combines the highest levels of copayment, 

the combined projected payments for the two 

highest copayment levels, the $50 copayment 

and the $20 copayment, are not more than 

one-half of the outpatient, in-network 

medical/surgical benefits subject to a 

copayment because they are exactly one-half 

($300x + $100x = $400x; $400x/$800x = 

50%). The combined projected payments for 

the three highest copayment levels—the $50 

copayment, the $20 copayment, and the $15 

copayment—are more than one-half of the 

outpatient, in-network medical/surgical 

benefits subject to the copayments ($100x + 

$300x + $200x = $600x; $600x/$800x = 

75%). Thus, the plan may not impose any 

copayment on outpatient, in-network mental 

health or substance use disorder benefits that 

is more restrictive than the least restrictive 

copayment in the combination, the $15 

copayment. 

(C) Example 3—(1) Facts. A plan imposes 

a $250 deductible on all medical/surgical 

benefits for self-only coverage and a $500 

deductible on all medical/surgical benefits 

for family coverage. The plan has no network 

of providers. For all medical/surgical 

benefits, the plan imposes a coinsurance 

requirement. The plan imposes no other 

financial requirements or treatment 

limitations. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(C) (Example 3), because the plan 

has no network of providers, all benefits are 

provided out-of-network. Because self-only 

and family coverage are subject to different 

deductibles, whether the deductible applies 

to substantially all medical/surgical benefits 

is determined separately for self-only 

medical/surgical benefits and family 

medical/surgical benefits. Because the 

coinsurance is applied without regard to 

coverage units, the predominant coinsurance 

that applies to substantially all medical/ 

surgical benefits is determined without 

regard to coverage units. 

(D) Example 4—(1) Facts. A plan applies 

the following financial requirements for 

prescription drug benefits. The requirements 

are applied without regard to whether a drug 

is generally prescribed with respect to 

medical/surgical benefits or with respect to 

mental health or substance use disorder 

benefits. Moreover, the process for certifying 

a particular drug as ‘‘generic’’, ‘‘preferred 

brand name’’, ‘‘non-preferred brand name’’, 

or ‘‘specialty’’ complies with the rules of 

paragraph (c)(4) of this section (relating to 

requirements for nonquantitative treatment 

limitations). 


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TABLE 3 TO PARAGRAPH (c)(3)(iv)(D)(1) 

Tier 1 Tier 2 Tier 3 Tier 4 

Tier description .................. Generic drugs ................... Preferred brand name 

drugs.

Non-preferred brand name 

drugs (which may have 

Tier 1 or Tier 2 alternatives).

Specialty drugs. 

Percent paid by plan ......... 90% ................................... 80% ................................... 60% ................................... 50%. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(D) (Example 4), the financial 

requirements that apply to prescription drug 

benefits are applied without regard to 

whether a drug is generally prescribed with 

respect to medical/surgical benefits or with 

respect to mental health or substance use 

disorder benefits; the process for certifying 

drugs in different tiers complies with 

paragraph (c)(4) of this section; and the bases 

for establishing different levels or types of 

financial requirements are reasonable. The 

financial requirements applied to 

prescription drug benefits do not violate the 

parity requirements of this paragraph (c)(3). 

(E) Example 5—(1) Facts. A plan has twotiers of network of providers: a preferred 

provider tier and a participating provider 

tier. Providers are placed in either the 

preferred tier or participating tier based on 

reasonable factors determined in accordance 

with the rules in paragraph (c)(4) of this 

section, such as accreditation, quality and 

performance measures (including customer 

feedback), and relative reimbursement rates. 

Furthermore, provider tier placement is 

determined without regard to whether a 

provider specializes in the treatment of 

mental health conditions or substance use 

disorders, or medical/surgical conditions. 

The plan divides the in-network 

classifications into two sub-classifications 

(in-network/preferred and in-network/ 

participating). The plan does not impose any 

financial requirement or treatment limitation 

on mental health or substance use disorder 

benefits in either of these sub-classifications 

that is more restrictive than the predominant 

financial requirement or treatment limitation 

that applies to substantially all medical/ 

surgical benefits in each sub-classification. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(E) (Example 5), the division of innetwork benefits into sub-classifications that 

reflect the preferred and participating 

provider tiers does not violate the parity 

requirements of this paragraph (c)(3). 

(F) Example 6—(1) Facts. With respect to 

outpatient, in-network benefits, a plan 

imposes a $25 copayment for office visits and 

a 20 percent coinsurance requirement for 

outpatient surgery. The plan divides the 

outpatient, in-network classification into two 

sub-classifications (in-network office visits 

and all other outpatient, in-network items 

and services).The plan does not impose any 

financial requirement or quantitative 

treatment limitation on mental health or 

substance use disorder benefits in either of 

these sub-classifications that is more 

restrictive than the predominant financial 

requirement or quantitative treatment 

limitation that applies to substantially all 

medical/surgical benefits in each subclassification. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(F) (Example 6), the division of 

outpatient, in-network benefits into subclassifications for office visits and all other 

outpatient, in-network items and services 

does not violate the parity requirements of 

this paragraph (c)(3). 

(G) Example 7—(1) Facts. Same facts as in 

paragraph (c)(3)(iv)(F)(1) of this section 

(Example 6), but for purposes of determining 

parity, the plan divides the outpatient, innetwork classification into outpatient, innetwork generalists and outpatient, innetwork specialists. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(G) (Example 7), the division of 

outpatient, in-network benefits into any subclassifications other than office visits and all 

other outpatient items and services violates 

the requirements of paragraph (c)(3)(iii)(C) of 

this section. 

* * * * * 

(4) Nonquantitative treatment 

limitations. Consistent with paragraph 

(a)(1) of this section, a group health plan 

may not impose any nonquantitative 

treatment limitation with respect to 

mental health or substance use disorder 

benefits in any classification that is 

more restrictive, as written or in 

operation, than the predominant 

nonquantitative treatment limitation 

that applies to substantially all medical/ 

surgical benefits in the same 

classification. For purposes of this 

paragraph (c)(4), a nonquantitative 

treatment limitation is more restrictive 

than the predominant nonquantitative 

treatment limitation that applies to 

substantially all medical/surgical 

benefits in the same classification if the 

plan fails to meet the requirements of 

paragraph (c)(4)(i) or (iii) of this section. 

In such a case, the plan will be 

considered to violate Code section 

9812(a)(3)(A)(ii), and the 

nonquantitative treatment limitation 

may not be imposed by the plan with 

respect to mental health or substance 

use disorder benefits in the 

classification. 

(i) Requirements related to design and 

application of a nonquantitative 

treatment limitation—(A) In general. A 

plan 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, as written 

and in operation, any processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

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 

designing and applying the limitation 

with respect to medical/surgical benefits 

in the classification. 

(B) Prohibition on discriminatory 

factors and evidentiary standards. For 

purposes of determining comparability 

and stringency under paragraph 

(c)(4)(i)(A) of this section, a plan may 

not rely upon discriminatory factors or 

evidentiary standards to design a 

nonquantitative treatment limitation to 

be imposed on mental health or 

substance use disorder benefits. A factor 

or evidentiary standard is 

discriminatory if the information, 

evidence, sources, or standards on 

which the factor or evidentiary standard 

are based are biased or not objective in 

a manner that discriminates against 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

(1) Information, evidence, sources, or 

standards are considered to be biased or 

not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

if, based on all the relevant facts and 

circumstances, the information, 

evidence, sources, or standards 

systematically disfavor access or are 

specifically designed to disfavor access 

to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. For purposes 

of this paragraph (c)(4)(i)(B)(1), relevant 

facts and circumstances may include, 

but are not limited to, the reliability of 

the source of the information, evidence, 

sources, or standards, including any 

underlying data; the independence of 

the information, evidence, sources, and 

standards relied upon; the analyses and 

methodologies employed to select the 

information and the consistency of their 

application; and any known safeguards 

deployed to prevent reliance on skewed 

data or metrics. Information, evidence, 


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sources, or standards are not considered 

biased or not objective for this purpose 

if the plan has taken the steps necessary 

to correct, cure, or supplement any 

information, evidence, sources, or 

standards that would have been biased 

or not objective in the absence of such 

steps. 

(2) For purposes of this paragraph 

(c)(4)(i)(B), historical plan data or other 

historical information from a time when 

the plan was not subject to Code section 

9812 or was not in compliance with 

Code section 9812 are considered to be 

biased or not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

if the historical plan data or other 

historical information systematically 

disfavor access or are specifically 

designed to disfavor access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits, and the plan has not 

taken the steps necessary to correct, 

cure, or supplement the data or 

information. 

(3) For purposes of this paragraph 

(c)(4)(i)(B), generally recognized 

independent professional medical or 

clinical standards and carefully 

circumscribed measures reasonably and 

appropriately designed to detect or 

prevent and prove fraud and abuse that 

minimize the negative impact on access 

to appropriate mental health and 

substance use disorder benefits are not 

information, evidence, sources, or 

standards that are biased or not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. However, 

plans must comply with the other 

requirements in this paragraph (c)(4), as 

applicable, with respect to such 

standards or measures that are used as 

the basis for a factor or evidentiary 

standard used to design or apply a 

nonquantitative treatment limitation. 

(ii) Illustrative, non-exhaustive list of 

nonquantitative treatment limitations. 

Nonquantitative treatment limitations 

include— 

(A) Medical management standards 

(such as prior authorization) limiting or 

excluding benefits based on medical 

necessity or medical appropriateness, or 

based on whether the treatment is 

experimental or investigative; 

(B) Formulary design for prescription 

drugs; 

(C) For plans with multiple network 

tiers (such as preferred providers and 

participating providers), network tier 

design; 

(D) Standards related to network 

composition, including but not limited 

to, standards for provider and facility 

admission to participate in a network or 

for continued network participation, 

including methods for determining 

reimbursement rates, credentialing 

standards, and procedures for ensuring 

the network includes an adequate 

number of each category of provider and 

facility to provide services under the 

plan; 

(E) Plan methods for determining outof-network rates, such as allowed 

amounts; usual, customary, and 

reasonable charges; or application of 

other external benchmarks for out-ofnetwork rates; 

(F) Refusal to pay for higher-cost 

therapies until it can be shown that a 

lower-cost therapy is not effective (also 

known as fail-first policies or step 

therapy protocols); 

(G) Exclusions based on failure to 

complete a course of treatment; and 

(H) Restrictions based on geographic 

location, facility type, provider 

specialty, and other criteria that limit 

the scope or duration of benefits for 

services provided under the plan. 

(iii) Required use of outcomes data— 

(A) In general. To ensure that a 

nonquantitative treatment limitation 

applicable to mental health or substance 

use disorder benefits in a classification, 

in operation, is no more restrictive than 

the predominant nonquantitative 

treatment limitation applied to 

substantially all medical/surgical 

benefits in the classification, a plan 

must collect and evaluate relevant data 

in a manner reasonably designed to 

assess the impact of the nonquantitative 

treatment limitation on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits 

and carefully consider the impact as 

part of the plan’s evaluation. As part of 

its evaluation, the plan may not 

disregard relevant outcomes data that it 

knows or reasonably should know 

suggest that a nonquantitative treatment 

limitation is associated with material 

differences in access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits. 

The Secretary, jointly with the Secretary 

of Labor and the Secretary of Health and 

Human Services, may specify in 

guidance the type, form, and manner of 

collection and evaluation for the data 

required under this paragraph 

(c)(4)(iii)(A). 

(1) Relevant data generally. For 

purposes of this paragraph (c)(4)(iii)(A), 

relevant data could include, as 

appropriate, but are not limited to, the 

number and percentage of claims 

denials and any other data relevant to 

the nonquantitative treatment limitation 

required by State law or private 

accreditation standards. 

(2) Relevant data for nonquantitative 

treatment limitations related to network 

composition. In addition to the relevant 

data set forth in paragraph 

(c)(4)(iii)(A)(1) of this section, relevant 

data for nonquantitative treatment 

limitations related to network 

composition could include, as 

appropriate, but are not limited to, innetwork and out-of-network utilization 

rates (including data related to provider 

claim submissions), network adequacy 

metrics (including time and distance 

data, and data on providers accepting 

new patients), and provider 

reimbursement rates (for comparable 

services and as benchmarked to a 

reference standard). 

(3) Unavailability of data. (i) If a plan 

newly imposes a nonquantitative 

treatment limitation for which relevant 

data is initially temporarily unavailable 

and the plan therefore cannot comply 

with this paragraph (c)(4)(iii)(A), the 

plan must include in its comparative 

analysis, as required under § 54.9812– 

2(c)(5)(i)(C), a detailed explanation of 

the lack of relevant data, the basis for 

the plan’s conclusion that there is a lack 

of relevant data, and when and how the 

data will become available and be 

collected and analyzed. Such a plan also 

must comply with this paragraph 

(c)(4)(iii)(A) as soon as practicable once 

relevant data becomes available. 

(ii) If a plan imposes a 

nonquantitative treatment limitation for 

which no data exist that can reasonably 

assess any relevant impact of the 

nonquantitative treatment limitation on 

relevant outcomes related to access to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits, the plan must include in its 

comparative analysis, as required under 

§ 54.9812–2(c)(5)(i)(D), a reasoned 

justification as to the basis for the 

conclusion that there are no data that 

can reasonably assess the 

nonquantitative treatment limitation’s 

impact, why the nature of the 

nonquantitative treatment limitation 

prevents the plan from reasonably 

measuring its impact, an explanation of 

what data was considered and rejected, 

and documentation of any additional 

safeguards or protocols used to ensure 

the nonquantitative treatment limitation 

complies with this section. If a plan 

becomes aware of data that can 

reasonably assess any relevant impact of 

the nonquantitative treatment 

limitation, the plan must comply with 

this paragraph (c)(4)(iii)(A) as soon as 

practicable. 

(iii) Consistent with paragraph (a)(1) 

of this section, paragraphs 


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(c)(4)(iii)(A)(3)(i) and (ii) of this section 

shall only apply in very limited 

circumstances and, where applicable, 

shall be construed narrowly. 

(B) Material differences. To the extent 

the relevant data evaluated under 

paragraph (c)(4)(iii)(A) of this section 

suggest that the nonquantitative 

treatment limitation contributes to 

material differences in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits in a classification, such 

differences will be considered a strong 

indicator that the plan violates this 

paragraph (c)(4). 

(1) Where the relevant data suggest 

that the nonquantitative treatment 

limitation contributes to material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits 

in a classification, the plan must take 

reasonable action, as necessary, to 

address the material differences to 

ensure compliance, in operation, with 

this paragraph (c)(4) and must 

document the actions that have been or 

are being taken by the plan to address 

material differences in access to mental 

health or substance use disorder 

benefits, as compared to medical/ 

surgical benefits, as required by 

§ 54.9812–2(c)(5)(iv). 

(2) For purposes of this paragraph 

(c)(4)(iii)(B), relevant data are 

considered to suggest that the 

nonquantitative treatment limitation 

contributes to material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits if, based on all 

relevant facts and circumstances, and 

taking into account the considerations 

outlined in this paragraph 

(c)(4)(iii)(B)(2), the difference in the data 

suggests that the nonquantitative 

treatment limitation is likely to have a 

negative impact on access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

(i) Relevant facts and circumstances, 

for purposes of this paragraph 

(c)(4)(iii)(B)(2), may include, but are not 

limited to, the terms of the 

nonquantitative treatment limitation at 

issue, the quality or limitations of the 

data, causal explanations and analyses, 

evidence as to the recurring or nonrecurring nature of the results, and the 

magnitude of any disparities. 

(ii) Differences in access to mental 

health or substance use disorder 

benefits attributable to generally 

recognized independent professional 

medical or clinical standards or 

carefully circumscribed measures 

reasonably and appropriately designed 

to detect or prevent and prove fraud and 

abuse that minimize the negative impact 

on access to appropriate mental health 

and substance use disorder benefits, 

which are used as the basis for a factor 

or evidentiary standard used to design 

or apply a nonquantitative treatment 

limitation, are not considered to be 

material for purposes of this paragraph 

(c)(4)(iii)(B). To the extent a plan 

attributes any differences in access to 

the application of such standards or 

measures, the plan must explain the 

bases for that conclusion in the 

documentation prepared under 

§ 54.9812–2(c)(5)(iv)(A). 

(C) Nonquantitative treatment 

limitations related to network 

composition. For purposes of applying 

paragraph (c)(4)(iii)(A) of this section 

with respect to nonquantitative 

treatment limitations related to network 

composition, a plan must collect and 

evaluate relevant data in a manner 

reasonably designed to assess the 

aggregate impact of all such 

nonquantitative treatment limitations on 

access to mental health and substance 

use disorder benefits and medical/ 

surgical benefits. Examples of possible 

actions that a plan could take to comply 

with the requirement under paragraph 

(c)(4)(iii)(B)(1) of this section to take 

reasonable action, as necessary, to 

address any material differences in 

access with respect to nonquantitative 

treatment limitations related to network 

composition, to ensure compliance with 

this paragraph (c)(4), include, but are 

not limited to: 

(1) Strengthening efforts to recruit and 

encourage a broad range of available 

mental health and substance use 

disorder providers and facilities to join 

the plan’s network of providers, 

including taking actions to increase 

compensation or other inducements, 

streamline credentialing processes, or 

contact providers reimbursed for items 

and services provided on an out-ofnetwork basis to offer participation in 

the network; 

(2) Expanding the availability of 

telehealth arrangements to mitigate any 

overall mental health and substance use 

disorder provider shortages in a 

geographic area; 

(3) Providing additional outreach and 

assistance to participants and 

beneficiaries enrolled in the plan to 

assist them in finding available innetwork mental health and substance 

use disorder providers and facilities; 

and 

(4) Ensuring that provider directories 

are accurate and reliable. 

(iv) Prohibition on separate 

nonquantitative treatment limitations 

applicable only to mental health or 

substance use disorder benefits. 

Consistent with paragraph (c)(2)(i) of 

this section, a group health plan may 

not apply any nonquantitative treatment 

limitation that is applicable only with 

respect to mental health or substance 

use disorder benefits and does not apply 

with respect to any medical/surgical 

benefits in the same benefit 

classification. 

(v) Effect of final determination of 

noncompliance under § 54.9812–2. (A) 

If a group health plan receives a final 

determination from the Secretary that 

the plan is not in compliance with the 

requirements of Code section 9812(a)(8) 

or § 54.9812–2 with respect to a 

nonquantitative treatment limitation, 

the nonquantitative treatment limitation 

violates this paragraph (c)(4) and the 

Secretary may direct the plan not to 

impose the nonquantitative treatment 

limitation with respect to mental health 

or substance use disorder benefits in the 

relevant classification, unless and until 

the plan demonstrates to the Secretary 

compliance with the requirements of 

this section or takes appropriate action 

to remedy the violation. 

(B) A determination by the Secretary 

of whether to require cessation of a 

nonquantitative treatment limitation 

under this paragraph (c)(4)(v) will be 

based on an evaluation of the relevant 

facts and circumstances involved in the 

specific final determination and the 

nature of the underlying 

nonquantitative treatment limitation 

and will take into account the interest 

of plan participants and beneficiaries 

and feedback from the plan. 

(vi) Examples. The rules of this 

paragraph (c)(4) are illustrated by the 

following examples. In each example, 

the group health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. 

(A) Example 1 (not comparable and more 

stringent factors for reimbursement rate 

methodology, in operation)—(1) Facts. A 

plan’s reimbursement rate methodology for 

outpatient, in-network providers is based on 

a variety of factors. As written, for mental 

health, substance use disorder, and medical/ 

surgical benefits, all reimbursement rates for 

physicians and non-physician practitioners 

for the same Current Procedural Terminology 

(CPT) code are based on a combination of 

factors, such as the nature of the service, 

duration of the service, intensity and 

specialization of training, provider licensure 

and type, number of providers qualified to 

provide the service in a given geographic 

area, and market need (demand). In 

operation, the plan utilizes an additional 

strategy to further reduce reimbursement 

rates for mental health and substance use 

disorder non-physician providers from those 


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paid to mental health and substance use 

disorder physicians by the same percentage 

for every CPT code, but does not apply the 

same reductions for non-physician medical/ 

surgical providers. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(A) (Example 1), the plan violates 

the rules of this paragraph (c)(4). Because the 

plan reimburses non-physician providers of 

mental health and substance use disorder 

services by reducing their reimbursement 

rate from the rate for physician providers of 

mental health and substance use disorder 

services by the same percentage for every 

CPT code but does not apply the same 

reductions to non-physician providers of 

medical/surgical services from the rate for 

physician providers of medical/surgical 

services, in operation, the factors used in 

designing and applying the nonquantitative 

treatment limitation to mental health and 

substance use disorder benefits in the 

outpatient, in-network classification are not 

comparable to, and are applied more 

stringently than, the factors used in designing 

and applying the limitation with respect to 

medical/surgical benefits in the same 

classification. As a result, the 

nonquantitative treatment limitation with 

respect to mental health or substance use 

disorder benefits in the outpatient, innetwork classification is more restrictive than 

the predominant nonquantitative treatment 

limitation that applies to substantially all 

medical/surgical benefits in the same 

classification. 

(B) Example 2 (strategy for exclusion for 

experimental or investigative treatment more 

stringently applied to ABA therapy in 

operation)—(1) Facts. A plan, as written, 

generally excludes coverage for all treatments 

that are experimental or investigative for both 

medical/surgical benefits and mental health 

and substance use disorder benefits in the 

outpatient, in-network classification. As a 

result, the plan generally excludes, as 

experimental, a treatment or procedure when 

no professionally recognized treatment 

guidelines include the treatment or 

procedure as a clinically appropriate 

standard of care for the condition or disorder 

and fewer than two randomized controlled 

trials are available to support the treatment’s 

use with respect to the given condition or 

disorder. The plan provides benefits for the 

treatment of ASD, which is a mental health 

condition, but, in operation, the plan 

excludes coverage for ABA therapy to treat 

children with ASD, deeming it experimental. 

More than one professionally recognized 

treatment guideline defines clinically 

appropriate standards of care for ASD and 

more than two randomized controlled trials 

are available to support the use of ABA 

therapy as one intervention to treat certain 

children with ASD. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(B) (Example 2), the plan violates the 

rules of this paragraph (c)(4). As written, the 

plan excludes coverage of experimental 

treatment of medical conditions and surgical 

procedures, mental health conditions, and 

substance use disorders when no 

professionally recognized treatment 

guidelines define clinically appropriate 

standards of care for the condition or 

disorder as including the treatment or 

procedure at issue, and fewer than two 

randomized controlled trials are available to 

support the treatment’s use with respect to 

the given condition or procedure. However, 

in operation, the plan deviates from this 

strategy with respect to ABA therapy because 

more than one professionally recognized 

treatment guideline defines clinically 

appropriate standards of care for ASD as 

including ABA therapy to treat certain 

children with ASD and more than two 

randomized controlled trials are available to 

support the use of ABA therapy to treat 

certain children with ASD. Therefore, in 

operation, the strategy used to design the 

nonquantitative treatment limitation for 

benefits for the treatment of ASD, which is 

a mental health condition, in the outpatient, 

in-network classification is not comparable 

to, and is applied more stringently than, the 

strategy used to design the nonquantitative 

treatment limitation for medical/surgical 

benefits in the same classification. As a 

result, the nonquantitative treatment 

limitation with respect to mental health or 

substance use disorder benefits in the 

outpatient, in-network classification is more 

restrictive than the predominant 

nonquantitative treatment limitation that 

applies to substantially all medical/surgical 

benefits in the same classification. 

(C) Example 3 (step therapy protocol with 

exception for severe or irreversible 

consequences, discriminatory factor)—(1) 

Facts. A plan’s written terms include a step 

therapy protocol that requires participants 

and beneficiaries who are prescribed certain 

drugs to try and fail a generic or preferred 

brand name drug before the plan will cover 

the drug originally prescribed by a 

participant’s or beneficiary’s attending 

provider. The plan provides an exception to 

this protocol that was developed solely based 

on a methodology developed by an external 

third-party organization. The third-party 

organization’s methodology, which is not 

based on a generally recognized independent 

professional medical or clinical standard, 

identifies instances in which a delay in 

treatment with a drug prescribed for a 

medical condition or surgical procedure 

could result in either severe or irreversible 

consequences. However, with respect to a 

drug prescribed for a mental health condition 

or a substance use disorder, the third-party 

organization’s methodology only identifies 

instances in which a delay in treatment could 

result in both severe and irreversible 

consequences, and the plan does not take any 

steps to correct, cure, or supplement the 

methodology. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(C) (Example 3), the plan violates the 

rules of paragraph (c)(4)(i)(B) of this section. 

The source upon which the factor used to 

apply the step therapy protocol is based is 

biased or not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits because it 

addresses instances in which a delay in 

treatment with a drug prescribed for a 

medical condition or surgical procedure 

could result in either severe or irreversible 

consequences, but only addresses instances 

in which a delay in treatment with a drug 

prescribed for a mental health condition or 

substance use disorder could result in both 

severe and irreversible consequences, and the 

plan fails to take the steps necessary to 

correct, cure, or supplement the methodology 

so that it is not biased and is objective. Based 

on the relevant facts and circumstances, this 

source systematically disfavors access or is 

specifically designed to disfavor access to 

mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits. Therefore, the factor used to apply 

the step therapy protocol is discriminatory 

for purposes of determining comparability 

and stringency under paragraph (c)(4)(i)(A) of 

this section, and may not be relied upon by 

the plan. 

(D) Example 4 (use of historical plan data 

and plan steps to correct, cure, or 

supplement)—(1) Facts. A plan’s 

methodology for calculating provider 

reimbursement rates relies only on historical 

plan data on total plan spending for each 

specialty, divided between mental health and 

substance use disorder providers and 

medical/surgical providers, from a time when 

the plan was not subject to Code section 

9812. The plan has used these historical plan 

data for many years to establish base 

reimbursement rates in all provider 

specialties for which it provides medical/ 

surgical, mental health, and substance use 

disorder benefits in the inpatient, in-network 

classification. In evaluating the use of these 

historical plan data in the design of the 

methodology for calculating provider 

reimbursement rates, the plan determined, 

based on all the relevant facts and 

circumstances, that the historical plan data 

systematically disfavor access or are 

specifically designed to disfavor access to 

mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits. To ensure this information about 

historical reimbursement rates is not biased 

and is objective, the plan supplements its 

methodology to develop the base 

reimbursement rates for mental health and 

substance use disorder providers in 

accordance with additional information, 

evidence, sources, and standards that reflect 

the increased demand for mental health and 

substance use disorder benefits in the 

inpatient, in-network classification and to 

attract sufficient mental health and substance 

use disorder providers to the network, so that 

the relevant facts and circumstances indicate 

the supplemented information, evidence, 

sources, or standards do not systematically 

disfavor access and are not specifically 

designed to disfavor access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(D) (Example 4), the plan does not 

violate the rules of paragraph (c)(4)(i)(B) of 

this section with respect to the plan’s 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification. The relevant facts and 

circumstances indicate that the plan’s use of 

only historical plan data to design its 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification would otherwise be 


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considered to be biased or not objective in a 

manner that discriminates against mental 

health or substance use disorder benefits as 

compared to medical/surgical benefits under 

paragraph (c)(4)(i)(B)(2) of this section, since 

the historical data systematically disfavor 

access or are specifically designed to disfavor 

access to mental health or substance use 

disorder benefits as compared to medical/ 

surgical benefits. However, the plan took the 

steps necessary to supplement the 

information, evidence, sources, and 

standards to reasonably reflect the increased 

demand for mental health and substance use 

disorder benefits in the inpatient, in-network 

classification, and adjust the methodology to 

increase reimbursement rates for those 

benefits, thereby ensuring that the 

information, evidence, sources, and 

standards relied upon by the plan for this 

purpose are not biased and are objective. 

Therefore, the factors and evidentiary 

standards used to design the plan’s 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification are not discriminatory. 

(E) Example 5 (generally recognized 

independent professional medical or clinical 

standards and more stringent prior 

authorization requirement in operation)—(1) 

Facts. The provisions of a plan state that it 

relies on, and does not deviate from, 

generally recognized independent 

professional medical or clinical standards to 

inform the factor used to design prior 

authorization requirements for both medical/ 

surgical and mental health and substance use 

disorder benefits in the prescription drug 

classification. The generally recognized 

independent professional medical standard 

for treatment of opioid use disorder that the 

plan utilizes—in this case, the American 

Society of Addiction Medicine national 

practice guidelines—does not support prior 

authorization every 30 days for 

buprenorphine/naloxone. However, in 

operation, the plan requires prior 

authorization for buprenorphine/naloxone 

combination for treatment of opioid use 

disorder, every 30 days, which is 

inconsistent with the generally recognized 

independent professional medical standard 

on which the factor used to design the 

limitation is based. The plan’s factor used to 

design prior authorization requirements for 

medical/surgical benefits in the prescription 

drug classification relies on, and does not 

deviate from, generally recognized 

independent professional medical or clinical 

standards. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(E) (Example 5), the plan violates the 

rules of this paragraph (c)(4). The American 

Society of Addiction Medicine national 

practice guidelines on which the factor used 

to design prior authorization requirements 

for substance use disorder benefits is based 

are generally recognized independent 

professional medical or clinical standards 

that are not considered to be biased or not 

objective in a manner that discriminates 

against mental health and substance use 

disorder benefits under paragraph 

(c)(4)(i)(B)(3) of this section. However, the 

plan must comply with other requirements in 

this paragraph (c)(4), as applicable, with 

respect to such standards or measures that 

are used as the basis for a factor or 

evidentiary standard used to design or apply 

a nonquantitative treatment limitation. In 

operation, the plan’s factor used to design 

and apply prior authorization requirements 

with respect to substance use disorder 

benefits is not comparable to, and is applied 

more stringently than, the same factor used 

to design and apply prior authorization 

requirements for medical/surgical benefits, 

because the factor relies on, and does not 

deviate from, generally recognized 

independent professional medical or clinical 

standards for medical/surgical benefits, but 

deviates from the relevant guidelines for 

substance use disorder benefits. As a result, 

the nonquantitative treatment limitation with 

respect to substance use disorder benefits in 

the prescription drug classification is more 

restrictive than the predominant 

nonquantitative treatment limitation that 

applies to substantially all medical/surgical 

benefits in the same classification. 

(F) Example 6 (plan claims no data exist 

to reasonably assess impact of 

nonquantitative treatment limitation on 

access; medical necessity criteria)—(1) Facts. 

A plan approves or denies claims for mental 

health and substance use disorder benefits 

and for medical/surgical benefits in the 

inpatient, in-network and outpatient, innetwork classifications based on medical 

necessity criteria. The plan states in its 

comparative analysis that no data exist that 

can reasonably assess any relevant impact of 

the medical necessity criteria nonquantitative 

treatment limitation on relevant outcomes 

related to access to mental health or 

substance use disorder benefits as compared 

to the plan’s medical necessity criteria 

nonquantitative treatment limitation’s impact 

on relevant outcomes related to access to 

medical/surgical benefits in the relevant 

classifications, without further explanation. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(F) (Example 6), the plan violates 

this paragraph (c)(4). The plan does not 

comply with paragraph (c)(4)(iii)(A)(3)(ii) of 

this section because the plan did not include 

in its comparative analysis, as required under 

§ 54.9812–2(c)(5)(i)(D), a reasoned 

justification as to the basis for its conclusion 

that there are no data that can reasonably 

assess the nonquantitative treatment 

limitation’s impact, an explanation of why 

the nature of the nonquantitative treatment 

limitation prevents the plan from reasonably 

measuring its impact, an explanation of what 

data was considered and rejected, and 

documentation of any additional safeguards 

or protocols used to ensure the 

nonquantitative treatment limitation 

complies with this paragraph (c)(4). Data that 

could reasonably assess the medical 

necessity criteria nonquantitative treatment 

limitation’s impact might include, for 

example, the number and percentage of 

claims denials, or the number and percentage 

of claims that were approved for a lower 

level of care than the level requested on the 

initial claim. Therefore, because the plan has 

not collected and evaluated relevant data in 

a manner reasonably designed to assess the 

impact of the nonquantitative treatment 

limitation on relevant outcomes related to 

access to mental health and substance use 

disorder benefits and medical/surgical 

benefits in the relevant classifications, the 

plan violates the requirements of paragraph 

(c)(4)(iii) of this section, and violates the 

requirements under § 54.9812–2(c)(5)(i)(D) 

because it did not include sufficient 

information in its comparative analysis with 

respect to the lack of relevant data. 

(G) Example 7 (concurrent review data 

collection; no material difference in access)— 

(1) Facts. A plan follows a written process to 

apply a concurrent review nonquantitative 

treatment limitation to all medical/surgical 

benefits and mental health and substance use 

disorder benefits within the inpatient, innetwork classification. Under this process, a 

first-level review is conducted in every 

instance in which concurrent review applies 

and an authorization request is approved by 

the first-level reviewer only if the clinical 

information submitted by the facility meets 

the plan’s criteria for a continued stay. If the 

first-level reviewer is unable to approve the 

authorization request because the clinical 

information submitted by the facility does 

not meet the plan’s criteria for a continued 

stay, it is sent to a second-level reviewer who 

will either approve or deny the request. The 

plan collects relevant data, including the 

number of referrals to second-level review, 

and the number of denials of claims for 

medical/surgical benefits and mental health 

and substance use disorder benefits subject to 

concurrent review as compared to the total 

number of claims subject to concurrent 

review, in the inpatient, in-network 

classification. The plan also collects and 

evaluates the number of denied claims for 

medical/surgical benefits and mental health 

and substance use disorder benefits that are 

overturned on appeal in the inpatient, innetwork classification. The plan evaluates 

the relevant data and determines that, based 

on the relevant facts and circumstances, the 

data do not suggest that the concurrent 

review nonquantitative treatment limitation 

contributes to material differences in access 

to mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits in the classification Upon requesting 

the plan’s comparative analysis for the 

concurrent review nonquantitative treatment 

limitation and reviewing the relevant data, 

the Secretary does not request additional data 

and agrees that the data do not suggest 

material differences in access. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(G) (Example 7), the plan does not 

violate the rules of paragraph (c)(4)(iii) of this 

section. The plan collected and evaluated 

relevant data in a manner reasonably 

designed to assess the impact of the 

nonquantitative treatment limitation on 

relevant outcomes related to access to mental 

health and substance use disorder benefits 

and medical/surgical benefits and considered 

the impact as part of its evaluation. Because 

the relevant data evaluated do not suggest 

that the nonquantitative treatment limitation 

contributes to material differences in access 

to mental health and substance use disorder 

benefits as compared to medical/surgical 

benefits in the inpatient, in-network 

classification, under paragraph (c)(4)(iii)(B) 

of this section, there is no strong indicator 

that the plan violates this paragraph (c)(4). 


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(H) Example 8 (material difference in 

access for prior authorization requirement 

with reasonable action)—(1) Facts. A plan 

requires prior authorization that a treatment 

is medically necessary for all inpatient, innetwork medical/surgical benefits and for all 

inpatient, in-network mental health and 

substance use disorder benefits. The plan 

collects and evaluates relevant data in a 

manner reasonably designed to assess the 

impact of the prior authorization requirement 

on relevant outcomes related to access to 

mental health and substance use disorder 

benefits and medical/surgical benefits in the 

inpatient, in-network classification. The 

plan’s written process for prior authorization 

states that the plan approves inpatient, innetwork benefits for medical conditions and 

surgical procedures and mental health and 

substance use disorder benefits for periods of 

1, 3, and 7 days, after which a treatment plan 

must be submitted by the patient’s attending 

provider and approved by the plan. 

Approvals for mental health and substance 

use disorder benefits are most commonly 

given only for 1 day, after which a treatment 

plan must be submitted by the patient’s 

attending provider and approved by the plan. 

The relevant data show that approvals for 7 

days are most common for medical 

conditions and surgical procedures under 

this plan. Based on all the relevant facts and 

circumstances, the difference in the relevant 

data suggests that the nonquantitative 

treatment limitation is likely to have a 

negative impact on access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

Therefore, the data suggest that the 

nonquantitative treatment limitation 

contributes to material differences in access. 

To address these material differences in 

access, the plan consults more recent medical 

guidelines to update the factors that inform 

its medical necessity nonquantitative 

treatment limitations. Based on this review, 

the plan modifies the limitation so that 

inpatient, in-network prior authorization 

requests for mental health or substance use 

disorder benefits are approved for similar 

periods to what is approved for medical/ 

surgical benefits. The plan includes 

documentation of this action as part of its 

comparative analysis. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(H) (Example 8), the plan does not 

violate the rules of paragraph (c)(4)(iii) of this 

section. While relevant data for the plan’s 

prior authorization requirements suggested 

that the nonquantitative treatment limitation 

contributes to material differences in access 

to mental health and substance use disorder 

benefits as compared to inpatient, in-network 

medical/surgical benefits under paragraph 

(c)(4)(iii)(B) of this section, the plan has 

taken reasonable action, as necessary, to 

ensure compliance, in operation, with this 

paragraph (c)(4) by updating the factors that 

inform its prior authorization 

nonquantitative treatment limitation for 

inpatient, in-network mental health and 

substance use disorder benefits so that these 

benefits are approved for similar periods to 

what is approved for medical/surgical 

benefits. The plan also documents its action 

taken to address material differences in 

access to inpatient, in-network benefits as 

required by paragraph (c)(4)(iii)(B)(1) of this 

section. 

(I) Example 9 (differences attributable to 

generally recognized independent 

professional medical or clinical standards)— 

(1) Facts. A group health plan develops a 

medical management requirement for all 

inpatient, out-of-network benefits for both 

medical/surgical benefits and mental health 

and substance use disorder benefits to ensure 

treatment is medically necessary. The factors 

and evidentiary standards used to design and 

apply the medical management requirement 

rely on independent professional medical or 

clinical standards that are generally 

recognized by health care providers and 

facilities in relevant clinical specialties. The 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the medical management 

requirement to mental health and substance 

use disorder benefits are comparable to, and 

are applied no more stringently than, the 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the requirement with respect to 

medical/surgical benefits. The plan collects 

and evaluates relevant data in a manner 

reasonably designed to assess the impact of 

the medical management nonquantitative 

treatment limitation on relevant outcomes 

related to access to mental health and 

substance use disorder benefits and medical/ 

surgical benefits, and considers the impact as 

part of the plan’s evaluation, as required by 

paragraph (c)(4)(iii)(A) of this section. Within 

the inpatient, out-of-network classification, 

the application of the medical management 

requirement results in a higher percentage of 

denials for mental health and substance use 

disorder claims than medical/surgical claims, 

because the benefits were found to be 

medically necessary for a lower percentage of 

mental health and substance use disorder 

claims. The plan correctly determines that 

these differences in access are attributable to 

the generally recognized independent 

professional medical or clinical standards 

used as the basis for the factors and 

evidentiary standards used to design or apply 

the limitation and adequately explains the 

bases for that conclusion as part of its 

comparative analysis. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(I) (Example 9), the plan does not 

violate the rules of this paragraph (c)(4). 

Generally recognized independent 

professional medical or clinical standards of 

care are not considered to be information, 

evidence, sources, or standards that are 

biased and not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits, and the plan 

otherwise complies with the requirements in 

paragraph (c)(4)(i) of this section. 

Additionally, the plan does not violate 

paragraph (c)(4)(iii) of this section because it 

has collected and evaluated relevant data, the 

differences in access are attributable to the 

generally recognized independent 

professional medical or clinical standards 

that are used as the basis for the factors and 

evidentiary standards used to design or apply 

the medical management nonquantitative 

treatment limitation, and the plan explains 

the bases for this conclusion in its 

comparative analysis. As a result, the 

nonquantitative treatment limitation with 

respect to mental health or substance use 

disorder benefits in the inpatient, out-ofnetwork classification is no more restrictive 

than the predominant nonquantitative 

treatment limitation that applies to 

substantially all medical/surgical benefits in 

the same classification. 

(J) Example 10 (material differences in 

access for standards for provider admission 

to a network with reasonable action)—(1) 

Facts. A plan applies nonquantitative 

treatment limitations related to network 

composition in the inpatient, in-network and 

outpatient, in-network classifications. The 

plan’s networks are constructed by separate 

service providers for medical/surgical 

benefits and mental health and substance use 

disorder benefits. The processes, strategies, 

evidentiary standards, and other factors used 

in designing and applying the 

nonquantitative treatment limitations related 

to network composition for mental health or 

substance use disorder benefits in the 

outpatient, in-network and inpatient, innetwork classifications are comparable to, 

and are applied no more stringently than, the 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the nonquantitative treatment 

limitations with respect to medical/surgical 

benefits in the classifications, as required 

under paragraph (c)(4)(i) of this section. In 

order to ensure, in operation, that the 

nonquantitative treatment limitations are no 

more restrictive than the predominant 

nonquantitative treatment limitations applied 

to substantially all medical/surgical benefits 

in the classification, the plan collects and 

evaluates relevant data in a manner 

reasonably designed to assess the aggregate 

impact of all the nonquantitative treatment 

limitations related to network composition 

on relevant outcomes related to access to 

mental health and substance use disorder 

benefits as compared with access to medical/ 

surgical benefits and considers the impact as 

part of the plan’s evaluation. The plan 

considers relevant data that is known, or 

reasonably should be known, including 

metrics relating to the time and distance from 

plan participants and beneficiaries to 

network providers in rural and urban regions; 

the number of network providers accepting 

new patients; the proportions of mental 

health and substance use disorder and 

medical/surgical providers and facilities that 

provide services in rural and urban regions 

who are in the plan’s network; provider 

reimbursement rates (for comparable services 

and benchmarked to a reference standard, as 

appropriate); and in-network and out-ofnetwork utilization rates (including data 

related to the dollar value and number of 

provider claims submissions). The plan 

determines that the relevant data suggest that 

the nonquantitative treatment limitations in 

the aggregate contribute to material 

differences in access to mental health and 

substance use disorder benefits compared to 

medical/surgical benefits in the 

classifications because, based on all the 

relevant facts and circumstances, the 


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differences in the data suggest that the 

nonquantitative treatment limitations related 

to network composition are likely to have a 

negative impact on access to mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits. The plan takes 

reasonable actions, as necessary, to address 

the material differences in access, to ensure 

compliance, in operation, with this 

paragraph (c)(4), by strengthening its efforts 

to recruit and encourage a broad range of 

available providers and facilities to join the 

plan’s network of providers, including by 

taking actions to increase compensation and 

other inducements, streamline credentialing 

processes, contact providers reimbursed for 

items and services provided on an out-ofnetwork basis to offer participation in the 

network, and develop a process to monitor 

the effects of such efforts; expanding the 

availability of telehealth arrangements to 

mitigate overall provider shortages in certain 

geographic areas; providing additional 

outreach and assistance to participants and 

beneficiaries enrolled in the plan to assist 

them in finding available in-network 

providers and facilities; and ensuring that the 

plan’s provider directories are accurate and 

reliable. The plan documents the efforts that 

it has taken to address the material 

differences in access that the data revealed, 

and the plan includes the documentation as 

part of its comparative analysis submission. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(J) (Example 10), the plan does not 

violate the rules of this paragraph (c)(4). The 

plan’s nonquantitative treatment limitations 

related to network composition comply with 

the rules of paragraph (c)(4)(i) of this section. 

Additionally, the plan collects and evaluates 

relevant data, as required under paragraph 

(c)(4)(iii)(A) of this section, in a manner 

reasonably designed to assess the aggregate 

impact of all such nonquantitative treatment 

limitations on relevant outcomes related to 

access to mental health and substance use 

disorder benefits and medical/surgical 

benefits, as required under paragraph 

(c)(4)(iii)(C) of this section. While the data 

suggest that the nonquantitative treatment 

limitations contribute to material differences 

in access to mental health and substance use 

disorder benefits as compared to medical/ 

surgical benefits, the plan has taken 

reasonable action, as necessary, to ensure 

compliance with this paragraph (c)(4). The 

plan also documents the actions that have 

been and are being taken by the plan to 

address material differences as required by 

§ 54.9812–21(c)(5)(iv). As a result, the 

network composition nonquantitative 

treatment limitations with respect to mental 

health or substance use disorder benefits in 

the inpatient, in-network and outpatient, innetwork classifications are no more 

restrictive than the predominant 

nonquantitative treatment limitations that 

apply to substantially all medical/surgical 

benefits in the same classifications. 

(K) Example 11 (separate EAP exhaustion 

treatment limitation applicable only to 

mental health or substance use disorder 

benefits)—(1) Facts. An employer maintains 

both a major medical plan and an employee 

assistance program (EAP). The EAP provides, 

among other benefits, a limited number of 

mental health or substance use disorder 

counseling sessions, which, together with 

other benefits provided by the EAP, are not 

significant benefits in the nature of medical 

care. Participants are eligible for mental 

health or substance use disorder benefits 

under the major medical plan only after 

exhausting the counseling sessions provided 

by the EAP. No similar exhaustion 

requirement applies with respect to medical/ 

surgical benefits provided under the major 

medical plan. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(K) (Example 11), the requirement 

that limits eligibility for mental health and 

substance use disorder benefits under the 

major medical plan until EAP benefits are 

exhausted is a nonquantitative treatment 

limitation subject to the parity requirements 

of this paragraph (c)(4). Because the 

limitation does not apply to medical/surgical 

benefits, it is a separate nonquantitative 

treatment limitation applicable only to 

mental health and substance use disorder 

benefits that violates paragraph (c)(4)(iv) of 

this section. Additionally, this EAP would 

not qualify as excepted benefits under 

§ 54.9831–1(c)(3)(vi)(B)(1) because 

participants in the major medical plan are 

required to use and exhaust benefits under 

the EAP (making the EAP a gatekeeper) 

before an individual is eligible for benefits 

under the plan. 

(L) Example 12 (separate exclusion for 

treatment in a residential facility applicable 

only to mental health and substance use 

disorder benefits)—(1) Facts. A plan 

generally covers inpatient, in-network and 

inpatient, out-of-network treatment without 

any limitations on setting, including skilled 

nursing facilities and rehabilitation hospitals, 

provided other medical necessity standards 

are satisfied. The plan has an exclusion for 

treatment at residential facilities, which the 

plan defines as an inpatient benefit for 

mental health and substance use disorder 

benefits. This exclusion was not generated 

through any broader nonquantitative 

treatment limitation (such as medical 

necessity or other clinical guideline). 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(L) (Example 12), the plan violates 

the rules of paragraph (c)(4)(iv) of this 

section. The exclusion of treatment at 

residential facilities is a separate 

nonquantitative treatment limitation 

applicable only to mental health and 

substance use disorder benefits in the 

inpatient, in-network and inpatient, out-ofnetwork classifications because the plan does 

not apply a comparable exclusion with 

respect to any medical/surgical benefits in 

the same benefit classification. 

(M) Example 13 (impermissible 

nonquantitative treatment limitation 

imposed following a final determination of 

noncompliance and direction by the 

Secretary)—(1) Facts. Following an initial 

request by the Secretary for a plan’s 

comparative analysis of the plan’s exclusion 

of mental health and substance use disorder 

benefits for failure to complete a course of 

treatment in the inpatient, in-network 

classification under § 54.9812–2(d), the plan 

submits a comparative analysis for the 

nonquantitative treatment limitation. After 

review of the comparative analysis, as well 

as additional information submitted by the 

plan after the Secretary determines that the 

plan has not submitted sufficient information 

to be responsive to the request, the Secretary 

makes an initial determination that the 

comparative analysis fails to demonstrate 

that the processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits in the 

inpatient, in-network classification are 

comparable to, and applied no more 

stringently than, those used in designing and 

applying the limitation to medical/surgical 

benefits in the classification. Under 

§ 54.9812–2(d)(3), the plan submits a 

corrective action plan and additional 

comparative analyses within 45 calendar 

days after the initial determination. However, 

the corrective action plan does not alter or 

eliminate the exclusion or alter the processes, 

strategies, evidentiary standards, and other 

factors used in designing and applying the 

exclusion. Moreover, the additional 

comparative analysis still does not include 

sufficient information. The Secretary then 

determines that the additional comparative 

analyses do not demonstrate compliance 

with the requirements of this paragraph 

(c)(4). Accordingly, the plan receives a final 

determination of noncompliance with Code 

section 9812(a)(8) and § 54.9812–2 from the 

Secretary, which concludes that the plan did 

not demonstrate compliance through the 

comparative analysis process. After 

considering the relevant facts and 

circumstances, and considering the interests 

of plan participants and beneficiaries, as well 

as feedback from the plan, the Secretary 

directs the plan not to impose the 

nonquantitative treatment limitation by a 

certain date, unless and until the plan 

demonstrates compliance to the Secretary or 

takes appropriate action to remedy the 

violation. The plan makes no changes to its 

plan terms by that date and continues to 

impose the exclusion of benefits for failure to 

complete a course of treatment in the 

inpatient, in-network classification. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(M) (Example 13), by continuing to 

impose the exclusion of mental health and 

substance use disorder benefits for failure to 

complete a course of treatment in the 

inpatient, in-network classification after the 

Secretary directs the plan not to impose this 

nonquantitative treatment limitation, the 

plan violates the requirements of paragraph 

(c)(4)(v) of this section. 

* * * * * 

* * * 

(3) Provisions of other law. 

Compliance with the disclosure 

requirements in paragraphs (d)(1) and 

(2) of this section is not determinative 

of compliance with any other provision 

of applicable Federal or State law. In 

particular, in addition to those 

disclosure requirements, provisions of 

other applicable law require disclosure 

of information relevant to medical/ 

surgical, mental health, and substance 

use disorder benefits. For example, 


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ERISA section 104 and 29 CFR 

2520.104b–1 provide that, for plans 

subject to ERISA, instruments under 

which the plan is established or 

operated must generally be furnished to 

plan participants within 30 days of 

request. Instruments under which the 

plan is established or operated include 

documents with information on medical 

necessity criteria for both medical/ 

surgical benefits and mental health and 

substance use disorder benefits; 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; and the comparative analyses 

and other applicable information 

required by § 54.9812–2. In addition, 29 

CFR 2560.503–1 and § 54.9815–2719 set 

forth rules regarding claims and 

appeals, including the right of claimants 

(or their authorized representative) who 

have received an adverse benefit 

determination (or a final internal 

adverse benefit determination) to be 

provided, upon request and free of 

charge, reasonable access to and copies 

of all documents, records, and other 

information relevant to the claimant’s 

claim for benefits. This includes 

documents 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 and the comparative analyses 

and other applicable information 

required by § 54.9812–2. 

(e) * * * 

(4) Coordination with EHB 

requirements. Nothing in paragraph (f) 

or (g) of this section or § 54.9812–2(g) 

changes the requirements of 45 CFR 

147.150 and 156.115 providing that a 

health insurance issuer offering nongrandfathered health insurance coverage 

in the individual or small group market 

that is required to provide mental health 

and substance use disorder services, 

including behavioral health treatment 

services, as part of essential health 

benefits required under 45 CFR 

156.110(a)(5) and 156.115(a), must 

comply with the requirements under 

section 2726 of the Public Health 

Service Act and its implementing 

regulations at 45 CFR 146.136 and 

146.137 to satisfy the requirement to 

provide coverage for mental health and 

substance use disorder services, 

including behavioral health treatment, 

as part of essential health benefits. 

* * * * * 

(i) * * * 

(1) In general. Except as provided in 

paragraph (i)(2) of this section— 

(i) This section applies to group 

health plans on the first day of the first 

plan year beginning on or after January 

1, 2025, except that the requirements of 

paragraphs (c)(2)(ii)(A), (c)(4)(i)(B), and 

(c)(4)(iii) of this section apply on the 

first day of the first plan year beginning 

on or after January 1, 2026. 

(ii) Until the applicability date in 

paragraph (i)(1)(i) of this section, plans 

are required to continue to comply with 

26 CFR 54.9812–1, revised as of April 1, 

2022. 

* * * * * 

(j) Severability. If any provision of this 

section is held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, or stayed 

pending further agency action, the 

provision shall be construed so as to 

continue to give the maximum effect to 

the provision permitted by law, unless 

such holding shall be one of invalidity 

or unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

■ Par. 3. Add § 54.9812–2 to read as 

follows: 

§ 54.9812–2 Nonquantitative treatment 

limitation comparative analysis 

requirements. 

(a) Meaning of terms. Unless 

otherwise stated in this section, the 

terms of this section have the meanings 

indicated in § 54.9812–1(a)(2). 

(b) In general. In the case of a group 

health plan that provides both medical/ 

surgical benefits and mental health or 

substance use disorder benefits and that 

imposes any nonquantitative treatment 

limitation on mental health or substance 

use disorder benefits, the plan must 

perform and document a comparative 

analysis of the design and application of 

each nonquantitative treatment 

limitation applicable to mental health or 

substance use disorder benefits. Each 

comparative analysis must comply with 

the content requirements of paragraph 

(c) of this section and be made available 

to the Secretary, upon request, in the 

manner required by paragraphs (d) and 

(e) of this section. 

(c) Comparative analysis content 

requirements. With respect to each 

nonquantitative treatment limitation 

applicable to mental health or substance 

use disorder benefits under a group 

health plan, the comparative analysis 

performed by the plan must include, at 

minimum, the elements specified in this 

paragraph (c). In addition to the 

comparative analysis for each 

nonquantitative treatment limitation, 

each plan must prepare and make 

available to the Secretary, upon request, 

a written list of all nonquantitative 

treatment limitations imposed under the 

plan. 

(1) Description of the nonquantitative 

treatment limitation. The comparative 

analysis must include, with respect to 

the nonquantitative treatment limitation 

that is the subject of the comparative 

analysis: 

(i) Identification of the 

nonquantitative treatment limitation, 

including the specific terms of the plan 

or other relevant terms regarding the 

nonquantitative treatment limitation, 

the policies or guidelines (internal or 

external) in which the nonquantitative 

treatment limitation appears or is 

described, and the applicable sections of 

any other relevant documents, such as 

provider contracts, that describe the 

nonquantitative treatment limitation; 

(ii) Identification of all mental health 

or substance use disorder benefits and 

medical/surgical benefits to which the 

nonquantitative treatment limitation 

applies, including a list of which 

benefits are considered mental health or 

substance use disorder benefits and 

which benefits are considered medical/ 

surgical benefits; and 

(iii) A description of which benefits 

are included in each classification set 

forth in § 54.9812–1(c)(2)(ii)(A). 

(2) Identification and definition of the 

factors and evidentiary standards used 

to design or apply the nonquantitative 

treatment limitation. The comparative 

analysis must include, with respect to 

every factor considered or relied upon 

to design the nonquantitative treatment 

limitation or apply the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits and 

medical/surgical benefits: 

(i) Identification of every factor 

considered or relied upon, as well as the 

evidentiary standards considered or 

relied upon to design or apply each 

factor and the sources from which each 

evidentiary standard was derived, in 

determining which mental health or 

substance use disorder benefits and 

which medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; and 

(ii) A definition of each factor, 

including: 

(A) A detailed description of the 

factor; 

(B) A description of each evidentiary 

standard used to design or apply each 


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factor (and the source of each 

evidentiary standard) identified under 

paragraph (c)(2)(i) of this section; and 

(C) A description of any steps the plan 

has taken to correct, cure, or 

supplement any information, evidence, 

sources, or standards that would 

otherwise have been considered biased 

or not objective under § 54.9812– 

1(c)(4)(i)(B)(1) in the absence of such 

steps. 

(3) Description of how factors are 

used in the design and application of 

the nonquantitative treatment 

limitation. The comparative analysis 

must include a description of how each 

factor identified and defined under 

paragraph (c)(2) of this section is used 

in the design or application of the 

nonquantitative treatment limitation to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits in a classification, including: 

(i) A detailed explanation of how each 

factor identified and defined in 

paragraph (c)(2) of this section is used 

to determine which mental health or 

substance use disorder benefits and 

which medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; 

(ii) An explanation of the evidentiary 

standards or other information or 

sources (if any) considered or relied 

upon in designing or applying the 

factors or relied upon in designing and 

applying the nonquantitative treatment 

limitation, including in the 

determination of whether and how 

mental health or substance use disorder 

benefits or medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; 

(iii) If the application of the factor 

depends on specific decisions made in 

the administration of benefits, the 

nature of the decisions, the timing of the 

decisions, and the professional 

designations and qualifications of each 

decision maker; 

(iv) If more than one factor is 

identified and defined in paragraph 

(c)(2) of this section, an explanation of: 

(A) How all of the factors relate to 

each other; 

(B) The order in which all the factors 

are applied, including when they are 

applied; 

(C) Whether and how any factors are 

given more weight than others; and 

(D) The reasons for the ordering or 

weighting of the factors; and 

(v) Any deviations or variations from 

a factor, its applicability, or its 

definition (including the evidentiary 

standards used to define the factor and 

the information or sources from which 

each evidentiary standard was derived), 

such as how the factor is used 

differently to apply the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

and a description of how the plan 

establishes such deviations or 

variations. 

(4) Demonstration of comparability 

and stringency as written. The 

comparative analysis must evaluate 

whether, in any classification, under the 

terms of the plan as written, any 

processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the 

nonquantitative treatment limitation to 

mental health or substance use disorder 

benefits are comparable to, and are 

applied no more stringently than, the 

processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the 

nonquantitative treatment limitation 

with respect to medical/surgical 

benefits. The comparative analysis must 

include, with respect to the 

nonquantitative treatment limitation 

and the factors used in designing and 

applying the nonquantitative treatment 

limitation: 

(i) Documentation of each factor 

identified and defined in paragraph 

(c)(2) of this section that was applied to 

determine whether the nonquantitative 

treatment limitation applies to mental 

health or substance use disorder 

benefits and medical/surgical benefits in 

a classification, including, as relevant: 

(A) Quantitative data, calculations, or 

other analyses showing whether, in each 

classification in which the 

nonquantitative treatment limitation 

applies, mental health or substance use 

disorder benefits and medical/surgical 

benefits met or did not meet any 

applicable threshold identified in the 

relevant evidentiary standard to 

determine that the nonquantitative 

treatment limitation would or would not 

apply; and 

(B) Records maintained by the plan 

documenting the consideration and 

application of all factors and evidentiary 

standards, as well as the results of their 

application; 

(ii) In each classification in which the 

nonquantitative treatment limitation 

applies to mental health or substance 

use disorder benefits, a comparison of 

how the nonquantitative treatment 

limitation, as written, is designed and 

applied to mental health or substance 

use disorder benefits and to medical/ 

surgical benefits, including the specific 

provisions of any forms, checklists, 

procedure manuals, or other 

documentation used in designing and 

applying the nonquantitative treatment 

limitation or that address the 

application of the nonquantitative 

treatment limitation; 

(iii) Documentation demonstrating 

how the factors are comparably applied, 

as written, to mental health or substance 

use disorder benefits and medical/ 

surgical benefits in each classification, 

to determine which benefits are subject 

to the nonquantitative treatment 

limitation; and 

(iv) An explanation of the reasons for 

any deviations or variations in the 

application of a factor used to apply the 

nonquantitative treatment limitation, or 

the application of the nonquantitative 

treatment limitation, to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

and how the plan establishes such 

deviations or variations, including: 

(A) In the definition of the factors, the 

evidentiary standards used to define the 

factors, and the sources from which the 

evidentiary standards were derived; 

(B) In the design of the factors or 

evidentiary standards; or 

(C) In the application or design of the 

nonquantitative treatment limitation. 

(5) Demonstration of comparability 

and stringency in operation. The 

comparative analysis must evaluate 

whether, in any classification, in 

operation, the processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

nonquantitative treatment limitation to 

mental health or substance use disorder 

benefits are comparable to, and are 

applied no more stringently than, the 

processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the limitation 

with respect to medical/surgical 

benefits. The comparative analysis must 

include, with respect to the 

nonquantitative treatment limitation 

and the factors used in designing and 

applying the nonquantitative treatment 

limitation: 

(i) A comprehensive explanation of 

how the plan evaluates whether, in 

operation, the processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

nonquantitative treatment limitation to 

mental health or substance use disorder 

benefits in a classification are 

comparable to, and are applied no more 

stringently than, the processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the nonquantitative treatment 

limitation with respect to medical/ 

surgical benefits, including: 

(A) An explanation of any 

methodology and underlying data used 

to demonstrate the application of the 

nonquantitative treatment limitation, in 

operation; 


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(B) The sample period, inputs used in 

any calculations, definitions of terms 

used, and any criteria used to select the 

mental health or substance use disorder 

benefits and medical/surgical benefits to 

which the nonquantitative treatment 

limitation is applicable; 

(C) With respect to a nonquantitative 

treatment limitation for which relevant 

data is temporarily unavailable as 

described in § 54.9812– 

1(c)(4)(iii)(A)(3)(i), a detailed 

explanation of the lack of relevant data, 

the basis for the plan’s conclusion that 

there is a lack of relevant data, and 

when and how the data will become 

available and be collected and analyzed; 

and 

(D) With respect to a nonquantitative 

treatment limitation for which no data 

exist that can reasonably assess any 

relevant impact of the nonquantitative 

treatment limitation on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits as 

described in § 54.9812– 

1(c)(4)(iii)(A)(3)(ii), a reasoned 

justification as to the basis for the 

conclusion that there are no data that 

can reasonably assess the 

nonquantitative treatment limitation’s 

impact, an explanation of why the 

nature of the nonquantitative treatment 

limitation prevents the plan from 

reasonably measuring its impact, an 

explanation of what data was 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

that the nonquantitative treatment 

limitation complies with § 54.9812– 

1(c)(4); 

(ii) Identification of the relevant data 

collected and evaluated, as required 

under § 54.9812–1(c)(4)(iii)(A); 

(iii) Documentation of the outcomes 

that resulted from the application of the 

nonquantitative treatment limitation to 

mental health or substance use disorder 

benefits and medical/surgical benefits, 

including: 

(A) The evaluation of relevant data as 

required under § 54.9812–1(c)(4)(iii)(A); 

and 

(B) A reasoned justification and 

analysis that explains why the plan 

concluded that any differences in the 

relevant data do or do not suggest the 

nonquantitative treatment limitation 

contributes to material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, in accordance 

with § 54.9812–1(c)(4)(iii)(B)(2); 

(iv) A detailed explanation of any 

material differences in access 

demonstrated by the outcomes 

evaluated under paragraph (c)(5)(iii) of 

this section, including: 

(A) A reasoned explanation of any 

material differences in access that are 

not attributable to differences in the 

comparability or relative stringency of 

the nonquantitative treatment limitation 

as applied to mental health or substance 

use disorder benefits and medical/ 

surgical benefits (including any 

considerations beyond a plan’s control 

that contribute to the existence of 

material differences) and a detailed 

explanation of the bases for concluding 

that material differences are not 

attributable to differences in the 

comparability or relative stringency of 

the nonquantitative treatment 

limitation; and 

(B) To the extent differences in access 

to mental health or substance use 

disorder benefits are attributable to 

generally recognized independent 

professional medical or clinical 

standards or carefully circumscribed 

measures reasonably and appropriately 

designed to detect or prevent and prove 

fraud and abuse that minimize the 

negative impact on access to appropriate 

mental health and substance use 

disorder benefits, and such standards or 

measures are used as the basis for a 

factor or evidentiary standard used to 

design or apply a nonquantitative 

treatment limitation, documentation 

explaining how any such differences are 

attributable to those standards or 

measures, as required in § 54.9812– 

1(c)(4)(iii)(B)(2)(ii); and 

(v) A discussion of the actions that 

have been or are being taken by the plan 

to address any material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, including the 

actions the plan has taken or is taking 

under § 54.9812–1(c)(4)(iii)(B)(1) to 

address material differences to comply, 

in operation, with § 54.9812–1(c)(4), 

including, as applicable: 

(A) A reasoned explanation of any 

material differences in access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits that persist despite 

reasonable actions that have been or are 

being taken; and 

(B) For a plan designing and applying 

one or more nonquantitative treatment 

limitations related to network 

composition, a discussion of the actions 

that have been or are being taken to 

address material differences in access to 

in-network mental health and substance 

use disorder benefits as compared to innetwork medical/surgical benefits, 

including those listed in § 54.9812– 

1(c)(4)(iii)(C). 

(6) Findings and conclusions. The 

comparative analysis must address the 

findings and conclusions as to the 

comparability of the processes, 

strategies, evidentiary standards, and 

other factors used in designing and 

applying the nonquantitative treatment 

limitation to mental health or substance 

use disorder benefits and medical/ 

surgical benefits within each 

classification, and the relative 

stringency of their application, both as 

written and in operation, and include: 

(i) Any findings or conclusions 

indicating that the plan is or is not (or 

might or might not be) in compliance 

with the requirements of § 54.9812– 

1(c)(4), including any additional actions 

the plan has taken or intends to take to 

address any potential areas of concern 

or noncompliance; 

(ii) A reasoned and detailed 

discussion of the findings and 

conclusions described in paragraph 

(c)(6)(i) of this section; 

(iii) Citations to any additional 

specific information not otherwise 

included in the comparative analysis 

that supports the findings and 

conclusions described in paragraph 

(c)(6)(i) of this section not otherwise 

discussed in the comparative analysis; 

(iv) The date the analysis is 

completed and the title and credentials 

of all relevant persons who participated 

in the performance and documentation 

of the comparative analysis; and 

(v) If the comparative analysis relies 

upon an evaluation by a reviewer or 

consultant considered by the plan to be 

an expert, an assessment of each 

expert’s qualifications and the extent to 

which the plan ultimately relied upon 

each expert’s evaluation in performing 

and documenting the comparative 

analysis of the design and application of 

the nonquantitative treatment limitation 

applicable to both mental health or 

substance use disorder benefits and 

medical/surgical benefits. 

(d) Requirements related to 

submission of comparative analyses to 

the Secretary upon request—(1) Initial 

request by the Secretary for comparative 

analysis. A group health plan must 

make the comparative analysis required 

by paragraph (b) of this section available 

and submit it to the Secretary within 10 

business days of receipt of a request 

from the Secretary (or an additional 

period of time specified by the 

Secretary). 

(2) Additional information required 

after a comparative analysis is deemed 

to be insufficient. In instances in which 

the Secretary determines that the plan 

has not submitted sufficient information 

under paragraph (d)(1) of this section for 

the Secretary to determine whether the 


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77718 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

comparative analysis required in 

paragraph (b) of this section complies 

with paragraph (c) of this section or 

whether the plan complies with 

§ 54.9812–1(c)(4), the Secretary will 

specify to the plan the additional 

information the plan must submit to the 

Secretary to be responsive to the request 

under paragraph (d)(1). Any such 

information must be provided to the 

Secretary by the plan within 10 business 

days after the Secretary specifies the 

additional information to be submitted 

(or an additional period of time 

specified by the Secretary). 

(3) Initial determination of 

noncompliance, required action, and 

corrective action plan. In instances in 

which the Secretary reviewed the 

comparative analysis submitted under 

paragraph (d)(1) of this section and any 

additional information submitted under 

paragraph (d)(2) of this section, and 

made an initial determination that the 

plan is not in compliance with the 

requirements of § 54.9812–1(c)(4) or this 

section, the plan must respond to the 

initial determination by the Secretary 

and specify the actions the plan will 

take to bring the plan into compliance, 

and provide to the Secretary additional 

comparative analyses meeting the 

requirements of paragraph (c) of this 

section that demonstrate compliance 

with § 54.9812–1(c)(4), not later than 45 

calendar days after the Secretary’s 

initial determination that the plan is not 

in compliance. 

(4) Requirement to notify participants 

and beneficiaries of final determination 

of noncompliance—(i) In general. If the 

Secretary makes a final determination of 

noncompliance, the plan must notify all 

participants and beneficiaries enrolled 

in the plan that the plan has been 

determined to not be in compliance 

with the requirements of § 54.9812– 

1(c)(4) or this section with respect to 

such plan. Such notice must be 

provided within 7 business days of 

receipt of the final determination of 

noncompliance, and the plan must 

provide a copy of the notice to the 

Secretary, any service provider involved 

in the claims process, and any fiduciary 

responsible for deciding benefit claims 

within the same timeframe. 

(ii) Content of notice. The notice to 

participants and beneficiaries required 

in paragraph (d)(4)(i) of this section 

shall be written in a manner calculated 

to be understood by the average plan 

participant and must include, in plain 

language, the following information in a 

standalone notice: 

(A) The following statement 

prominently displayed on the first page, 

in no less than 14-point font: 

‘‘Attention! The Department of the 

Treasury has determined that [insert the 

name of group health plan] is not in 

compliance with the Mental Health 

Parity and Addiction Equity Act.’’; 

(B) A summary of changes the plan 

has made as part of its corrective action 

plan specified to the Secretary following 

the initial determination of 

noncompliance, including an 

explanation of any opportunity for a 

participant or beneficiary to have a 

claim for benefits submitted or 

reprocessed; 

(C) A summary of the Secretary’s final 

determination that the plan is not in 

compliance with § 54.9812–1(c)(4) or 

this section, including any provisions or 

practices identified as being in violation 

of § 54.9812–1(c)(4) or this section, 

additional corrective actions identified 

by the Secretary in the final 

determination notice, and information 

on how participants and beneficiaries 

can obtain from the plan a copy of the 

final determination of noncompliance; 

(D) Any additional actions the plan is 

taking to come into compliance with 

§ 54.9812–1(c)(4) or this section, when 

the plan will take such actions, and a 

clear and accurate statement explaining 

whether the Secretary has concurred 

with those actions; and 

(E) Contact information for questions 

and complaints, and a statement 

explaining how participants and 

beneficiaries can obtain more 

information about the notice, including: 

(1) The plan’s phone number and an 

email or web portal address; and 

(2) The Employee Benefits Security 

Administration’s phone number and 

email or web portal address. 

(iii) Manner of notice. The plan must 

make the notice required under 

paragraph (d)(4)(i) of this section 

available in paper form, or 

electronically (such as by email or an 

internet posting) if: 

(A) The format is readily accessible; 

(B) The notice is provided in paper 

form free of charge upon request; and 

(C) In a case in which the electronic 

form is an internet posting, the plan 

timely notifies the participant or 

beneficiary in paper form (such as a 

postcard) or email, that the documents 

are available on the internet, provides 

the internet address, includes the 

statement required in paragraph 

(d)(4)(ii)(A) of this section, and notifies 

the participant or beneficiary that the 

documents are available in paper form 

upon request. 

(e) Requests for a copy of a 

comparative analysis. In addition to 

making a comparative analysis available 

upon request to the Secretary, a plan 

must make available a copy of the 

comparative analysis required by 

paragraph (b) of this section when 

requested by: 

(1) Any applicable State authority; 

and 

(2) A participant or beneficiary 

(including a provider or other person 

acting as a participant’s or beneficiary’s 

authorized representative) who has 

received an adverse benefit 

determination related to mental health 

or substance use disorder benefits. 

(f) Rule of construction. Nothing in 

this section or § 54.9812–1 shall be 

construed to prevent the Secretary from 

acting within the scope of existing 

authorities to address violations of 

§ 54.9812–1 or this section. 

(g) Applicability. The provisions of 

this section apply to group health plans 

described in § 54.9812–1(e), to the 

extent the plan is not exempt under 

§ 54.9812–1(f) or (g), on the first day of 

the first plan year beginning on or after 

January 1, 2025, except the 

requirements of paragraphs (c)(2)(ii)(C), 

(c)(5)(i)(C) and (D), and (c)(5)(ii) through 

(v) of this section apply on the first day 

of the first plan year beginning on or 

after January 1, 2026. 

(h) Severability. If any provision of 

this section is held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, or stayed 

pending further agency action, the 

provision shall be construed so as to 

continue to give the maximum effect to 

the provision permitted by law, unless 

such holding shall be one of invalidity 

or unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

DEPARTMENT OF LABOR 

Employee Benefits Security 

Administration 

29 CFR Chapter XXV 

For the reasons set forth in the 

preamble, the Department of Labor 

amends 29 CFR part 2590 as set forth 

below: 

PART 2590—RULES AND 

REGULATIONS FOR GROUP HEALTH 

PLANS 

■ 4. The authority citation for part 2590 

continues to read as follows: 

Authority: 29 U.S.C. 1027, 1059, 1135, 

1161–1168, 1169, 1181–1183, 1181 note, 

1185, 1185a–n, 1191, 1191a, 1191b, and 

1191c; sec. 101(g), Pub. L. 104–191, 110 Stat. 

1936; sec. 401(b), Pub. L. 105–200, 112 Stat. 

645 (42 U.S.C. 651 note); sec. 512(d), Pub. L. 

110–343, 122 Stat. 3881; sec. 1001, 1201, and 

1562(e), Pub. L. 111–148, 124 Stat. 119, as 

amended by Pub. L. 111–152, 124 Stat. 1029; 


khammond on DSKJM1Z7X2PROD with RULES2
Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77719 

Division M, Pub. L. 113–235, 128 Stat. 2130; 

Pub. L. 116–260, 134 Stat. 1182; Secretary of 

Labor’s Order 1–2011, 77 FR 1088 (Jan. 9, 

2012). 

■ 5. Amend § 2590.712 by: 

■ a. Redesignating paragraph (a) as 

paragraph (a)(2) and adding paragraphs 

(a) heading and (a)(1); 

■ b. In newly redesignated paragraph 

(a)(2): 

■ i. Revising the introductory text; 

■ ii. Adding the definitions of ‘‘DSM,’’ 

‘‘Evidentiary standards,’’ ‘‘Factors,’’ and 

‘‘ICD’’ in alphabetical order; 

■ iii. Revising the definitions of 

‘‘Medical/surgical benefits’’ and 

‘‘Mental health benefits’’; 

■ iv. Adding the definitions of 

‘‘Processes’’ and ‘‘Strategies’’ in 

alphabetical order; and 

■ v. Revising the definitions of 

‘‘Substance use disorder benefits’’ and 

‘‘Treatment limitations’’; 

■ c. Revising paragraphs (c)(1)(ii), 

(c)(2)(i), (c)(2)(ii)(A) introductory text, 

(c)(2)(ii)(C), and (c)(3)(i)(A), (C), and (D); 

■ d. In paragraph (c)(3)(iii), adding 

introductory text; 

■ e. Revising paragraphs (c)(3)(iii)(A) 

and (B), (c)(3)(iv), (c)(4), (d)(3), (e)(4), 

and (i)(1); and 

■ f. Adding paragraph (j). 

The revisions and additions read as 

follows: 

§ 2590.712 Parity in mental health and 

substance use disorder benefits. 

(a) Purpose and meaning of terms— 

(1) Purpose. This section and 

§ 2590.712–1 set forth rules to ensure 

parity in aggregate lifetime and annual 

dollar limits, financial requirements, 

and quantitative and nonquantitative 

treatment limitations between mental 

health and substance use disorder 

benefits and medical/surgical benefits, 

as required under ERISA section 712. A 

fundamental purpose of ERISA section 

712, this section, and § 2590.712–1 is to 

ensure that participants and 

beneficiaries in a group health plan (or 

health insurance coverage offered by an 

issuer in connection with a group health 

plan) that offers mental health or 

substance use disorder benefits are not 

subject to more restrictive aggregate 

lifetime or annual dollar limits, 

financial requirements, or treatment 

limitations with respect to those 

benefits than the predominant dollar 

limits, financial requirements, or 

treatment limitations that are applied to 

substantially all medical/surgical 

benefits covered by the plan or coverage 

in the same classification, as further 

provided in this section and § 2590.712– 

1. Accordingly, in complying with the 

provisions of ERISA section 712, this 

section, and § 2590.712–1, plans and 

issuers must not design or apply 

financial requirements and treatment 

limitations that impose a greater burden 

on access (that is, are more restrictive) 

to mental health or substance use 

disorder benefits under the plan or 

coverage than they impose on access to 

medical/surgical benefits in the same 

classification of benefits. The provisions 

of ERISA section 712, this section, and 

§ 2590.712–1 should be interpreted in a 

manner that is consistent with the 

purpose described in this paragraph 

(a)(1). 

(2) Meaning of terms. For purposes of 

this section and § 2590.712–1, except 

where the context clearly indicates 

otherwise, the following terms have the 

meanings indicated: 

* * * * * 

DSM means the American Psychiatric 

Association’s Diagnostic and Statistical 

Manual of Mental Disorders. For the 

purpose of this definition, the most 

current version of the DSM as of 

November 22, 2024, is the Diagnostic 

and Statistical Manual of Mental 

Disorders, Fifth Edition, Text Revision 

published in March 2022. A subsequent 

version of the DSM published after 

November 22, 2024, will be considered 

the most current version beginning on 

the first day of the plan year that is one 

year after the date the subsequent 

version is published. 

Evidentiary standards are any 

evidence, sources, or standards that a 

group health plan (or health insurance 

issuer offering coverage in connection 

with such a plan) considered or relied 

upon in designing or applying a factor 

with respect to a nonquantitative 

treatment limitation, including specific 

benchmarks or thresholds. Evidentiary 

standards may be empirical, statistical, 

or clinical in nature, and include: 

sources acquired or originating from an 

objective third party, such as recognized 

medical literature, professional 

standards and protocols (which may 

include comparative effectiveness 

studies and clinical trials), published 

research studies, payment rates for 

items and services (such as publicly 

available databases of the ‘‘usual, 

customary and reasonable’’ rates paid 

for items and services), and clinical 

treatment guidelines; internal plan or 

issuer data, such as claims or utilization 

data or criteria for assuring a sufficient 

mix and number of network providers; 

and benchmarks or thresholds, such as 

measures of excessive utilization, cost 

levels, time or distance standards, or 

network participation percentage 

thresholds. 

Factors are all information, including 

processes and strategies (but not 

evidentiary standards), that a group 

health plan (or health insurance issuer 

offering coverage in connection with 

such a plan) considered or relied upon 

to design a nonquantitative treatment 

limitation, or to determine whether or 

how the nonquantitative treatment 

limitation applies to benefits under the 

plan or coverage. Examples of factors 

include, but are not limited to: provider 

discretion in determining a diagnosis or 

type or length of treatment; clinical 

efficacy of any proposed treatment or 

service; licensing and accreditation of 

providers; claim types with a high 

percentage of fraud; quality measures; 

treatment outcomes; severity or 

chronicity of condition; variability in 

the cost of an episode of treatment; high 

cost growth; variability in cost and 

quality; elasticity of demand; and 

geographic location. 

* * * * * 

ICD means the World Health 

Organization’s International 

Classification of Diseases adopted by the 

Department of Health and Human 

Services through 45 CFR 162.1002. For 

the purpose of this definition, the most 

current version of the ICD as of 

November 22, 2024, is the International 

Classification of Diseases, 10th 

Revision, Clinical Modification adopted 

for the period beginning on October 1, 

2015. Any subsequent version of the 

ICD adopted through 45 CFR 162.1002 

after November 22, 2024, will be 

considered the most current version 

beginning on the first day of the plan 

year that is one year after the date the 

subsequent version is adopted. 

Medical/surgical benefits means 

benefits with respect to items or services 

for medical conditions or surgical 

procedures, as defined under the terms 

of the group health plan (or health 

insurance coverage offered by an issuer 

in connection with such a plan) and in 

accordance with applicable Federal and 

State law, but does not include mental 

health benefits or substance use 

disorder benefits. Notwithstanding the 

preceding sentence, any condition or 

procedure defined by the plan or 

coverage as being or as not being a 

medical condition or surgical procedure 

must be defined consistent with 

generally recognized independent 

standards of current medical practice 

(for example, the most current version 

of the ICD). To the extent generally 

recognized independent standards of 

current medical practice do not address 

whether a condition or procedure is a 

medical condition or surgical 

procedure, plans and issuers may define 

the condition or procedure in 


khammond on DSKJM1Z7X2PROD with RULES2
77720 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

accordance with applicable Federal and 

State law. 

Mental health benefits means benefits 

with respect to items or services for 

mental health conditions, as defined 

under the terms of the group health plan 

(or health insurance coverage offered by 

an issuer in connection with such a 

plan) and in accordance with applicable 

Federal and State law, but does not 

include medical/surgical benefits or 

substance use disorder benefits. 

Notwithstanding the preceding 

sentence, any condition defined by the 

plan or coverage as being or as not being 

a mental health condition must be 

defined consistent with generally 

recognized independent standards of 

current medical practice. For the 

purpose of this definition, to be 

consistent with generally recognized 

independent standards of current 

medical practice, the definition must 

include all conditions covered under 

the plan or coverage, except for 

substance use disorders, that fall under 

any of the diagnostic categories listed in 

the mental, behavioral, and 

neurodevelopmental disorders chapter 

(or equivalent chapter) of the most 

current version of the ICD or that are 

listed in the most current version of the 

DSM. To the extent generally recognized 

independent standards of current 

medical practice do not address whether 

a condition is a mental health condition, 

plans and issuers may define the 

condition in accordance with applicable 

Federal and State law. 

Processes are actions, steps, or 

procedures that a group health plan (or 

health insurance issuer offering 

coverage in connection with such a 

plan) uses to apply a nonquantitative 

treatment limitation, including actions, 

steps, or procedures established by the 

plan or issuer as requirements in order 

for a participant or beneficiary to access 

benefits, including through actions by a 

participant’s or beneficiary’s authorized 

representative or a provider or facility. 

Examples of processes include, but are 

not limited to: procedures to submit 

information to authorize coverage for an 

item or service prior to receiving the 

benefit or while treatment is ongoing 

(including requirements for peer or 

expert clinical review of that 

information); provider referral 

requirements that are used to determine 

when and how a participant or 

beneficiary may access certain services; 

and the development and approval of a 

treatment plan used in a concurrent 

review process to determine whether a 

specific request should be granted or 

denied. Processes also include the 

specific procedures used by staff or 

other representatives of a plan or issuer 

(or the service provider of a plan or 

issuer) to administer the application of 

nonquantitative treatment limitations, 

such as how a panel of staff members 

applies the nonquantitative treatment 

limitation (including the qualifications 

of staff involved, number of staff 

members allocated, and time allocated), 

consultations with panels of experts in 

applying the nonquantitative treatment 

limitation, and the degree of reviewer 

discretion in adhering to criteria 

hierarchy when applying a 

nonquantitative treatment limitation. 

Strategies are practices, methods, or 

internal metrics that a plan (or health 

insurance issuer offering coverage in 

connection with such a plan) considers, 

reviews, or uses to design a 

nonquantitative treatment limitation. 

Examples of strategies include, but are 

not limited to: the development of the 

clinical rationale used in approving or 

denying benefits; the method of 

determining whether and how to 

deviate from generally accepted 

standards of care in concurrent reviews; 

the selection of information deemed 

reasonably necessary to make medical 

necessity determinations; reliance on 

treatment guidelines or guidelines 

provided by third-party organizations in 

the design of a nonquantitative 

treatment limitation; and rationales 

used in selecting and adopting certain 

threshold amounts to apply a 

nonquantitative treatment limitation, 

professional standards and protocols to 

determine utilization management 

standards, and fee schedules used to 

determine provider reimbursement 

rates, used as part of a nonquantitative 

treatment limitation. Strategies also 

include the method of creating and 

determining the composition of the staff 

or other representatives of a plan or 

issuer (or the service provider of a plan 

or issuer) that deliberates, or otherwise 

makes decisions, on the design of 

nonquantitative treatment limitations, 

including the plan’s or issuer’s methods 

for making decisions related to the 

qualifications of staff involved, number 

of staff members allocated, and time 

allocated; breadth of sources and 

evidence considered; consultations with 

panels of experts in designing the 

nonquantitative treatment limitation; 

and the composition of the panels used 

to design a nonquantitative treatment 

limitation. 

Substance use disorder benefits 

means benefits with respect to items or 

services for substance use disorders, as 

defined under the terms of the group 

health plan (or health insurance 

coverage offered by an issuer in 

connection with such a plan) and in 

accordance with applicable Federal and 

State law, but does not include medical/ 

surgical benefits or mental health 

benefits. Notwithstanding the preceding 

sentence, any disorder defined by the 

plan or coverage as being or as not being 

a substance use disorder must be 

defined consistent with generally 

recognized independent standards of 

current medical practice. For the 

purpose of this definition, to be 

consistent with generally recognized 

independent standards of current 

medical practice, the definition must 

include all disorders covered under the 

plan or coverage that fall under any of 

the diagnostic categories listed as a 

mental or behavioral disorder due to 

psychoactive substance use (or 

equivalent category) in the mental, 

behavioral, and neurodevelopmental 

disorders chapter (or equivalent 

chapter) of the most current version of 

the ICD or that are listed as a SubstanceRelated and Addictive Disorder (or 

equivalent category) in the most current 

version of the DSM. To the extent 

generally recognized independent 

standards of current medical practice do 

not address whether a disorder is a 

substance use disorder, plans and 

issuers may define the disorder in 

accordance with applicable Federal and 

State law. 

Treatment limitations include limits 

on benefits based on the frequency of 

treatment, number of visits, days of 

coverage, days in a waiting period, or 

other similar limits on the scope or 

duration of treatment. Treatment 

limitations include both quantitative 

treatment limitations, which are 

expressed numerically (such as 50 

outpatient visits per year), and 

nonquantitative treatment limitations 

(such as standards related to network 

composition), which otherwise limit the 

scope or duration of benefits for 

treatment under a plan or coverage. (See 

paragraph (c)(4)(ii) of this section for an 

illustrative, non-exhaustive list of 

nonquantitative treatment limitations.) 

A complete exclusion of all benefits for 

a particular condition or disorder, 

however, is not a treatment limitation 

for purposes of this definition. 

* * * * * 

(c) * * * 

(1) * * * 

(ii) Type of financial requirement or 

treatment limitation. When reference is 

made in this paragraph (c) to a type of 

financial requirement or treatment 

limitation, the reference to type means 

its nature. Different types of financial 

requirements include deductibles, 

copayments, coinsurance, and out-ofpocket maximums. Different types of 

quantitative treatment limitations 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77721 

include annual, episode, and lifetime 

day and visit limits. See paragraph 

(c)(4)(ii) of this section for an 

illustrative, non-exhaustive list of 

nonquantitative treatment limitations. 

* * * * * 

(2) * * * 

(i) General rule. A group health plan 

(or health insurance coverage offered by 

an issuer in connection with a group 

health plan) that provides both medical/ 

surgical benefits and mental health or 

substance use disorder benefits may not 

apply any financial requirement or 

treatment limitation to mental health or 

substance use disorder benefits in any 

classification that is more restrictive 

than the predominant financial 

requirement or treatment limitation of 

that type applied to substantially all 

medical/surgical benefits in the same 

classification. Whether a financial 

requirement or treatment limitation is a 

predominant financial requirement or 

treatment limitation that applies to 

substantially all medical/surgical 

benefits in a classification is determined 

separately for each type of financial 

requirement or treatment limitation. A 

plan or issuer may not impose any 

financial requirement or treatment 

limitation that is applicable only with 

respect to mental health or substance 

use disorder benefits and not to any 

medical/surgical benefits in the same 

benefit classification. The application of 

the rules of this paragraph (c)(2) to 

financial requirements and quantitative 

treatment limitations is addressed in 

paragraph (c)(3) of this section; the 

application of the rules of this 

paragraph (c)(2) to nonquantitative 

treatment limitations is addressed in 

paragraph (c)(4) of this section. 

(ii) * * * 

(A) In general. If a plan (or health 

insurance coverage) provides any 

benefits for a mental health condition or 

substance use disorder in any 

classification of benefits described in 

this paragraph (c)(2)(ii), it must provide 

meaningful benefits for that mental 

health condition or substance use 

disorder in every classification in which 

medical/surgical benefits are provided. 

For purposes of this paragraph 

(c)(2)(ii)(A), whether the benefits 

provided are meaningful benefits is 

determined in comparison to the 

benefits provided for medical 

conditions and surgical procedures in 

the classification and requires, at a 

minimum, coverage of benefits for that 

condition or disorder in each 

classification in which the plan (or 

coverage) provides benefits for one or 

more medical conditions or surgical 

procedures. A plan (or coverage) does 

not provide meaningful benefits under 

this paragraph (c)(2)(ii)(A) unless it 

provides benefits for a core treatment for 

that condition or disorder in each 

classification in which the plan (or 

coverage) provides benefits for a core 

treatment for one or more medical 

conditions or surgical procedures. For 

purposes of this paragraph (c)(2)(ii)(A), 

a core treatment for a condition or 

disorder is a standard treatment or 

course of treatment, therapy, service, or 

intervention indicated by generally 

recognized independent standards of 

current medical practice. If there is no 

core treatment for a covered mental 

health condition or substance use 

disorder with respect to a classification, 

the plan (or coverage) is not required to 

provide benefits for a core treatment for 

such condition or disorder in that 

classification (but must provide benefits 

for such condition or disorder in every 

classification in which medical/surgical 

benefits are provided). In determining 

the classification in which a particular 

benefit belongs, a plan (or health 

insurance issuer) must apply the same 

standards to medical/surgical benefits 

and to mental health or substance use 

disorder benefits. To the extent that a 

plan (or health insurance coverage) 

provides benefits in a classification and 

imposes any separate financial 

requirement or treatment limitation (or 

separate level of a financial requirement 

or treatment limitation) for benefits in 

the classification, the rules of this 

paragraph (c) apply separately with 

respect to that classification for all 

financial requirements or treatment 

limitations (illustrated in examples in 

paragraph (c)(2)(ii)(C) of this section). 

The following classifications of benefits 

are the only classifications used in 

applying the rules of this paragraph (c), 

in addition to the permissible subclassifications described in paragraph 

(c)(3)(iii) of this section: 

* * * * * 

(C) Examples. The rules of this 

paragraph (c)(2)(ii) are illustrated by the 

following examples. In each example, 

the group health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. With regard to the 

examples in this paragraph (c)(2)(ii)(C), 

references to any particular core 

treatment are included for illustrative 

purposes only. Plans and issuers must 

consult generally recognized 

independent standards of current 

medical practice to determine the 

applicable core treatment, therapy, 

service, or intervention for any covered 

condition or disorder. 

(1) Example 1—(i) Facts. A group health 

plan offers inpatient and outpatient benefits 

and does not contract with a network of 

providers. The plan imposes a $500 

deductible on all benefits. For inpatient 

medical/surgical benefits, the plan imposes a 

coinsurance requirement. For outpatient 

medical/surgical benefits, the plan imposes 

copayments. The plan imposes no other 

financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(1) (Example 1), because the plan 

has no network of providers, all benefits 

provided are out-of-network. Because 

inpatient, out-of-network medical/surgical 

benefits are subject to separate financial 

requirements from outpatient, out-of-network 

medical/surgical benefits, the rules of this 

paragraph (c) apply separately with respect to 

any financial requirements and treatment 

limitations, including the deductible, in each 

classification. 

(2) Example 2—(i) Facts. A plan imposes 

a $500 deductible on all benefits. The plan 

has no network of providers. The plan 

generally imposes a 20 percent coinsurance 

requirement with respect to all benefits, 

without distinguishing among inpatient, 

outpatient, emergency care, or prescription 

drug benefits. The plan imposes no other 

financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(2) (Example 2), because the plan 

does not impose separate financial 

requirements (or treatment limitations) based 

on classification, the rules of this paragraph 

(c) apply with respect to the deductible and 

the coinsurance across all benefits. 

(3) Example 3—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(2)(i) of this section 

(Example 2), except the plan exempts 

emergency care benefits from the 20 percent 

coinsurance requirement. The plan imposes 

no other financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(3) (Example 3), because the plan 

imposes separate financial requirements 

based on classifications, the rules of this 

paragraph (c) apply with respect to the 

deductible and the coinsurance separately for 

benefits in the emergency care classification 

and all other benefits. 

(4) Example 4—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(2)(i) of this section 

(Example 2), except the plan also imposes a 

preauthorization requirement for all inpatient 

treatment in order for benefits to be paid. No 

such requirement applies to outpatient 

treatment. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(4) (Example 4), because the plan 

has no network of providers, all benefits 

provided are out-of-network. Because the 

plan imposes a separate treatment limitation 

based on classifications, the rules of this 

paragraph (c) apply with respect to the 

deductible and coinsurance separately for 

inpatient, out-of-network benefits and all 

other benefits. 

(5) Example 5—(i) Facts. A plan covers 

treatment for autism spectrum disorder 

(ASD), a mental health condition, and covers 

outpatient, out-of-network developmental 


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screenings for ASD but excludes all other 

benefits for outpatient treatment for ASD, 

including applied behavior analysis (ABA) 

therapy, when provided on an out-of-network 

basis. The plan generally covers the full 

range of outpatient treatments (including 

core treatments) and treatment settings for 

medical conditions and surgical procedures 

when provided on an out-of-network basis. 

Under the generally recognized independent 

standards of current medical practice 

consulted by the plan, developmental 

screenings alone do not constitute a core 

treatment for ASD. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(5) (Example 5), the plan violates 

the rules of this paragraph (c)(2)(ii). Although 

the plan covers benefits for ASD in the 

outpatient, out-of-network classification, it 

only covers developmental screenings, so it 

does not cover a core treatment for ASD in 

the classification. Because the plan generally 

covers the full range of medical/surgical 

benefits, including a core treatment for one 

or more medical conditions or surgical 

procedures in the classification, it fails to 

provide meaningful benefits for treatment of 

ASD in the classification. 

(6) Example 6—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(5) of this section 

(Example 5), except that the plan is an HMO 

that does not cover the full range of medical/ 

surgical benefits, including a core treatment 

for any medical conditions or surgical 

procedures in the outpatient, out-of-network 

classification (except as required under 

ERISA sections 716 and 717), but covers 

benefits for medical conditions and surgical 

procedures in the inpatient, in-network; 

outpatient, in-network; emergency care; and 

prescription drug classifications. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(6) (Example 6), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

Because the plan does not provide 

meaningful benefits, including for a core 

treatment for any medical condition or 

surgical procedure in the outpatient, out-ofnetwork classification (except as required 

under ERISA sections 716 and 717), the plan 

is not required to provide meaningful 

benefits for any mental health conditions or 

substance use disorders in that classification. 

Nevertheless, the plan must provide 

meaningful benefits for each mental health 

condition and substance use disorder for 

which the plan provides benefits in every 

classification in which meaningful medical/ 

surgical benefits are provided as required 

under paragraph (c)(2)(ii)(A) of this section. 

This example does not address whether the 

plan has complied with other applicable 

requirements of this section in excluding 

coverage of ABA therapy in the outpatient, 

out-of-network classification. 

(7) Example 7—(i) Facts. A plan provides 

extensive benefits, including for core 

treatments for many medical conditions and 

surgical procedures in the outpatient, innetwork classification, including nutrition 

counseling for diabetes and obesity. The plan 

also generally covers diagnosis and treatment 

for eating disorders, which are mental health 

conditions, including coverage for nutrition 

counseling to treat eating disorders in the 

outpatient, in-network classification. 

Nutrition counseling is a core treatment for 

eating disorders, in accordance with 

generally recognized independent standards 

of current medical practice consulted by the 

plan. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(7) (Example 7), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

The coverage of diagnosis and treatment for 

eating disorders, including nutrition 

counseling, in the outpatient, in-network 

classification results in the plan providing 

meaningful benefits for the treatment of 

eating disorders in the classification, as 

determined in comparison to the benefits 

provided for medical conditions or surgical 

procedures in the classification. 

(8) Example 8—(i) Facts. A plan provides 

extensive benefits for the core treatments for 

many medical conditions and surgical 

procedures in the outpatient, in-network and 

prescription drug classifications. The plan 

provides coverage for diagnosis and 

treatment for opioid use disorder, a substance 

use disorder, in the outpatient, in-network 

classification, by covering counseling and 

behavioral therapies and, in the prescription 

drug classification, by covering medications 

to treat opioid use disorder (MOUD). 

Counseling and behavioral therapies and 

MOUD, in combination, are one of the core 

treatments for opioid use disorder, in 

accordance with generally recognized 

independent standards of current medical 

practice consulted by the plan. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(8) (Example 8), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

The coverage of counseling and behavioral 

therapies and MOUD, in combination, in the 

outpatient, in-network classification and 

prescription drug classification, respectively, 

results in the plan providing meaningful 

benefits for the treatment of opioid use 

disorder in the outpatient, in-network and 

prescription drug classifications. 

(3) * * * 

(i) * * * 

(A) Substantially all. For purposes of 

this paragraph (c)(3), a type of financial 

requirement or quantitative treatment 

limitation is considered to apply to 

substantially all medical/surgical 

benefits in a classification of benefits if 

it applies to at least two-thirds of all 

medical/surgical benefits in that 

classification. (For purposes of this 

paragraph (c)(3)(i)(A), benefits 

expressed as subject to a zero level of a 

type of financial requirement are treated 

as benefits not subject to that type of 

financial requirement, and benefits 

expressed as subject to a quantitative 

treatment limitation that is unlimited 

are treated as benefits not subject to that 

type of quantitative treatment 

limitation.) If a type of financial 

requirement or quantitative treatment 

limitation does not apply to at least twothirds of all medical/surgical benefits in 

a classification, then that type cannot be 

applied to mental health or substance 

use disorder benefits in that 

classification. 

* * * * * 

(C) Portion based on plan payments. 

For purposes of this paragraph (c)(3), 

the determination of the portion of 

medical/surgical benefits in a 

classification of benefits subject to a 

financial requirement or quantitative 

treatment limitation (or subject to any 

level of a financial requirement or 

quantitative treatment limitation) is 

based on the dollar amount of all plan 

payments for medical/surgical benefits 

in the classification expected to be paid 

under the plan for the plan year (or for 

the portion of the plan year after a 

change in plan benefits that affects the 

applicability of the financial 

requirement or quantitative treatment 

limitation). 

(D) Clarifications for certain threshold 

requirements. For any deductible, the 

dollar amount of plan payments 

includes all plan payments with respect 

to claims that would be subject to the 

deductible if it had not been satisfied. 

For any out-of-pocket maximum, the 

dollar amount of plan payments 

includes all plan payments associated 

with out-of-pocket payments that are 

taken into account towards the out-ofpocket maximum as well as all plan 

payments associated with out-of-pocket 

payments that would have been made 

towards the out-of-pocket maximum if it 

had not been satisfied. The rules of this 

paragraph (c)(3)(i)(D) apply for any 

other thresholds at which the rate of 

plan payment changes. (See also PHS 

Act section 2707 and Affordable Care 

Act section 1302(c), which establish 

annual limitations on out-of-pocket 

maximums for all non-grandfathered 

health plans.) 

* * * * * 

(iii) Special rules. Unless specifically 

permitted under this paragraph 

(c)(3)(iii), sub-classifications are not 

permitted when applying the rules of 

paragraph (c)(3) of this section. 

(A) Multi-tiered prescription drug 

benefits. If a plan (or health insurance 

coverage) applies different levels of 

financial requirements to different tiers 

of prescription drug benefits based on 

reasonable factors determined in 

accordance with the rules in paragraph 

(c)(4) of this section (relating to 

requirements for nonquantitative 

treatment limitations) and without 

regard to whether a drug is generally 

prescribed with respect to medical/ 

surgical benefits or with respect to 

mental health or substance use disorder 

benefits, the plan (or health insurance 

coverage) satisfies the parity 

requirements of this paragraph (c) with 


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respect to prescription drug benefits. 

Reasonable factors include cost, 

efficacy, generic versus brand name, and 

mail order versus pharmacy pick-up. 

(B) Multiple network tiers. If a plan (or 

health insurance coverage) provides 

benefits through multiple tiers of innetwork providers (such as an innetwork tier of preferred providers with 

more generous cost-sharing to 

participants than a separate in-network 

tier of participating providers), the plan 

may divide its benefits furnished on an 

in-network basis into sub-classifications 

that reflect network tiers, if the tiering 

is based on reasonable factors 

determined in accordance with the rules 

in paragraph (c)(4) of this section (such 

as quality, performance, and market 

standards) and without regard to 

whether a provider provides services 

with respect to medical/surgical benefits 

or mental health or substance use 

disorder benefits. After the subclassifications are established, the plan 

or issuer may not impose any financial 

requirement or treatment limitation on 

mental health or substance use disorder 

benefits in any sub-classification that is 

more restrictive than the predominant 

financial requirement or treatment 

limitation that applies to substantially 

all medical/surgical benefits in the subclassification using the methodology set 

forth in paragraph (c)(3)(i) of this 

section. 

* * * * * 

(iv) Examples. The rules of 

paragraphs (c)(3)(i) through (iii) of this 

section are illustrated by the following 

examples. In each example, the group 

health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. 

(A) Example 1—(1) Facts. (i) For inpatient, 

out-of-network medical/surgical benefits, a 

group health plan imposes five levels of 

coinsurance. Using a reasonable method, the 

plan projects its payments for the upcoming 

year as follows: 

TABLE 1 TO PARAGRAPH (c)(3)(iv)(A)(1)(i) 

Coinsurance rate .............................. 0% .......... 10% .............................. 15% .............................. 20% .............................. 30% .............................. Total. 

Projected payments .......................... $200x ..... $100x ........................... $450x ........................... $100x ........................... $150x ........................... $1,000x. 

Percent of total plan costs ............... 20% ........ 10% .............................. 45% .............................. 10% .............................. 15%.

Percent subject to coinsurance level N/A ......... 12.5% (100x/800x) ...... 56.25% (450x/800x) .... 12.5% (100x/800x) ...... 18.75% (150x/800x).

(ii) The plan projects plan costs of $800x 

to be subject to coinsurance ($100x + $450x 

+ $100x + $150x = $800x). Thus, 80 percent 

($800x/$1,000x) of the benefits are projected 

to be subject to coinsurance, and 56.25 

percent of the benefits subject to coinsurance 

are projected to be subject to the 15 percent 

coinsurance level. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(A) (Example 1), the two-thirds 

threshold of the substantially all standard is 

met for coinsurance because 80 percent of all 

inpatient, out-of-network medical/surgical 

benefits are subject to coinsurance. Moreover, 

the 15 percent coinsurance is the 

predominant level because it is applicable to 

more than one-half of inpatient, out-ofnetwork medical/surgical benefits subject to 

the coinsurance requirement. The plan may 

not impose any level of coinsurance with 

respect to inpatient, out-of-network mental 

health or substance use disorder benefits that 

is more restrictive than the 15 percent level 

of coinsurance. 

(B) Example 2—(1) Facts. (i) For 

outpatient, in-network medical/surgical 

benefits, a plan imposes five different 

copayment levels. Using a reasonable 

method, the plan projects payments for the 

upcoming year as follows: 

TABLE 2 TO PARAGRAPH (c)(3)(iv)(B)(1)(i) 

Copayment amount .......................... $0 ........... $10 ............................... $15 ............................... $20 ............................... $50 ............................... Total. 

Projected payments .......................... $200x ..... $200x ........................... $200x ........................... $300x ........................... $100x ........................... $1,000x. 

Percent of total plan costs ............... 20% ........ 20% .............................. 20% .............................. 30% .............................. 10%.

Percent subject to copayments ........ N/A ......... 25% (200x/800x) ......... 25% (200x/800x) ......... 37.5% (300x/800x) ...... 12.5% (100x/800x).

(ii) The plan projects plan costs of $800x 

to be subject to copayments ($200x + $200x 

+ $300x + $100x = $800x). Thus, 80 percent 

($800x/$1,000x) of the benefits are projected 

to be subject to a copayment. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(B) (Example 2), the two-thirds 

threshold of the substantially all standard is 

met for copayments because 80 percent of all 

outpatient, in-network medical/surgical 

benefits are subject to a copayment. 

Moreover, there is no single level that applies 

to more than one-half of medical/surgical 

benefits in the classification subject to a 

copayment (for the $10 copayment, 25%; for 

the $15 copayment, 25%; for the $20 

copayment, 37.5%; and for the $50 

copayment, 12.5%). The plan can combine 

any levels of copayment, including the 

highest levels, to determine the predominant 

level that can be applied to mental health or 

substance use disorder benefits. If the plan 

combines the highest levels of copayment, 

the combined projected payments for the two 

highest copayment levels, the $50 copayment 

and the $20 copayment, are not more than 

one-half of the outpatient, in-network 

medical/surgical benefits subject to a 

copayment because they are exactly one-half 

($300x + $100x = $400x; $400x/$800x = 

50%). The combined projected payments for 

the three highest copayment levels—the $50 

copayment, the $20 copayment, and the $15 

copayment—are more than one-half of the 

outpatient, in-network medical/surgical 

benefits subject to the copayments ($100x + 

$300x + $200x = $600x; $600x/$800x = 

75%). Thus, the plan may not impose any 

copayment on outpatient, in-network mental 

health or substance use disorder benefits that 

is more restrictive than the least restrictive 

copayment in the combination, the $15 

copayment. 

(C) Example 3—(1) Facts. A plan imposes 

a $250 deductible on all medical/surgical 

benefits for self-only coverage and a $500 

deductible on all medical/surgical benefits 

for family coverage. The plan has no network 

of providers. For all medical/surgical 

benefits, the plan imposes a coinsurance 

requirement. The plan imposes no other 

financial requirements or treatment 

limitations. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(C) (Example 3), because the plan 

has no network of providers, all benefits are 

provided out-of-network. Because self-only 

and family coverage are subject to different 

deductibles, whether the deductible applies 

to substantially all medical/surgical benefits 

is determined separately for self-only 

medical/surgical benefits and family 

medical/surgical benefits. Because the 

coinsurance is applied without regard to 

coverage units, the predominant coinsurance 

that applies to substantially all medical/ 

surgical benefits is determined without 

regard to coverage units. 

(D) Example 4—(1) Facts. A plan applies 

the following financial requirements for 

prescription drug benefits. The requirements 

are applied without regard to whether a drug 

is generally prescribed with respect to 

medical/surgical benefits or with respect to 

mental health or substance use disorder 

benefits. Moreover, the process for certifying 

a particular drug as ‘‘generic’’, ‘‘preferred 

brand name’’, ‘‘non-preferred brand name’’, 

or ‘‘specialty’’ complies with the rules of 

paragraph (c)(4) of this section (relating to 

requirements for nonquantitative treatment 

limitations). 


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TABLE 3 TO PARAGRAPH (c)(3)(iv)(D)(1) 

Tier 1 Tier 2 Tier 3 Tier 4 

Tier description .................. Generic drugs ................... Preferred brand name 

drugs.

Non-preferred brand name 

drugs (which may have 

Tier 1 or Tier 2 alternatives).

Specialty drugs. 

Percent paid by plan ......... 90% ................................... 80% ................................... 60% ................................... 50%. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(D) (Example 4), the financial 

requirements that apply to prescription drug 

benefits are applied without regard to 

whether a drug is generally prescribed with 

respect to medical/surgical benefits or with 

respect to mental health or substance use 

disorder benefits; the process for certifying 

drugs in different tiers complies with 

paragraph (c)(4) of this section; and the bases 

for establishing different levels or types of 

financial requirements are reasonable. The 

financial requirements applied to 

prescription drug benefits do not violate the 

parity requirements of this paragraph (c)(3). 

(E) Example 5—(1) Facts. A plan has two 

-tiers of network of providers: a preferred 

provider tier and a participating provider 

tier. Providers are placed in either the 

preferred tier or participating tier based on 

reasonable factors determined in accordance 

with the rules in paragraph (c)(4) of this 

section, such as accreditation, quality and 

performance measures (including customer 

feedback), and relative reimbursement rates. 

Furthermore, provider tier placement is 

determined without regard to whether a 

provider specializes in the treatment of 

mental health conditions or substance use 

disorders, or medical/surgical conditions. 

The plan divides the in-network 

classifications into two sub-classifications 

(in-network/preferred and in-network/ 

participating). The plan does not impose any 

financial requirement or treatment limitation 

on mental health or substance use disorder 

benefits in either of these sub-classifications 

that is more restrictive than the predominant 

financial requirement or treatment limitation 

that applies to substantially all medical/ 

surgical benefits in each sub-classification. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(E) (Example 5), the division of innetwork benefits into sub-classifications that 

reflect the preferred and participating 

provider tiers does not violate the parity 

requirements of this paragraph (c)(3). 

(F) Example 6—(1) Facts. With respect to 

outpatient, in-network benefits, a plan 

imposes a $25 copayment for office visits and 

a 20 percent coinsurance requirement for 

outpatient surgery. The plan divides the 

outpatient, in-network classification into two 

sub-classifications (in-network office visits 

and all other outpatient, in-network items 

and services).The plan or issuer does not 

impose any financial requirement or 

quantitative treatment limitation on mental 

health or substance use disorder benefits in 

either of these sub-classifications that is more 

restrictive than the predominant financial 

requirement or quantitative treatment 

limitation that applies to substantially all 

medical/surgical benefits in each subclassification. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(F) (Example 6), the division of 

outpatient, in-network benefits into subclassifications for office visits and all other 

outpatient, in-network items and services 

does not violate the parity requirements of 

this paragraph (c)(3). 

(G) Example 7—(1) Facts. Same facts as in 

paragraph (c)(3)(iv)(F)(1) of this section 

(Example 6), but for purposes of determining 

parity, the plan divides the outpatient, innetwork classification into outpatient, innetwork generalists and outpatient, innetwork specialists. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(G) (Example 7), the division of 

outpatient, in-network benefits into any subclassifications other than office visits and all 

other outpatient items and services violates 

the requirements of paragraph (c)(3)(iii)(C) of 

this section. 

* * * * * 

(4) Nonquantitative treatment 

limitations. Consistent with paragraph 

(a)(1) of this section, a group health plan 

(or health insurance coverage offered by 

an issuer in connection with a group 

health plan) may not impose any 

nonquantitative treatment limitation 

with respect to mental health or 

substance use disorder benefits in any 

classification that is more restrictive, as 

written or in operation, than the 

predominant nonquantitative treatment 

limitation that applies to substantially 

all medical/surgical benefits in the same 

classification. For purposes of this 

paragraph (c)(4), a nonquantitative 

treatment limitation is more restrictive 

than the predominant nonquantitative 

treatment limitation that applies to 

substantially all medical/surgical 

benefits in the same classification if the 

plan or issuer fails to meet the 

requirements of paragraph (c)(4)(i) or 

(iii) of this section. In such a case, the 

plan (or health insurance coverage) will 

be considered to violate ERISA section 

712(a)(3)(A)(ii), and the nonquantitative 

treatment limitation may not be 

imposed by the plan (or health 

insurance coverage) with respect to 

mental health or substance use disorder 

benefits in the classification. 

(i) Requirements related to design and 

application of a nonquantitative 

treatment limitation—(A) In general. A 

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 

designing and 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 designing and 

applying the limitation with respect to 

medical/surgical benefits in the 

classification. 

(B) Prohibition on discriminatory 

factors and evidentiary standards. For 

purposes of determining comparability 

and stringency under paragraph 

(c)(4)(i)(A) of this section, a plan (or 

health insurance coverage) may not rely 

upon discriminatory factors or 

evidentiary standards to design a 

nonquantitative treatment limitation to 

be imposed on mental health or 

substance use disorder benefits. A factor 

or evidentiary standard is 

discriminatory if the information, 

evidence, sources, or standards on 

which the factor or evidentiary standard 

are based are biased or not objective in 

a manner that discriminates against 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

(1) Information, evidence, sources, or 

standards are considered to be biased or 

not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

if, based on all the relevant facts and 

circumstances, the information, 

evidence, sources, or standards 

systematically disfavor access or are 

specifically designed to disfavor access 

to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. For purposes 

of this paragraph (c)(4)(i)(B)(1), relevant 

facts and circumstances may include, 

but are not limited to, the reliability of 

the source of the information, evidence, 

sources, or standards, including any 

underlying data; the independence of 

the information, evidence, sources, and 


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standards relied upon; the analyses and 

methodologies employed to select the 

information and the consistency of their 

application; and any known safeguards 

deployed to prevent reliance on skewed 

data or metrics. Information, evidence, 

sources, or standards are not considered 

biased or not objective for this purpose 

if the plan or issuer has taken the steps 

necessary to correct, cure, or 

supplement any information, evidence, 

sources, or standards that would have 

been biased or not objective in the 

absence of such steps. 

(2) For purposes of this paragraph 

(c)(4)(i)(B), historical plan data or other 

historical information from a time when 

the plan or coverage was not subject to 

ERISA section 712 or was not in 

compliance with ERISA section 712 are 

considered to be biased or not objective 

in a manner that discriminates against 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits, if the historical plan 

data or other historical information 

systematically disfavor access or are 

specifically designed to disfavor access 

to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, and the plan 

or issuer has not taken the steps 

necessary to correct, cure, or 

supplement the data or information. 

(3) For purposes of this paragraph 

(c)(4)(i)(B), generally recognized 

independent professional medical or 

clinical standards and carefully 

circumscribed measures reasonably and 

appropriately designed to detect or 

prevent and prove fraud and abuse that 

minimize the negative impact on access 

to appropriate mental health and 

substance use disorder benefits are not 

information, evidence, sources, or 

standards that are biased or not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. However, 

plans and issuers must comply with the 

other requirements in this paragraph 

(c)(4), as applicable, with respect to 

such standards or measures that are 

used as the basis for a factor or 

evidentiary standard used to design or 

apply a nonquantitative treatment 

limitation. 

(ii) Illustrative, non-exhaustive list of 

nonquantitative treatment limitations. 

Nonquantitative treatment limitations 

include— 

(A) Medical management standards 

(such as prior authorization) limiting or 

excluding benefits based on medical 

necessity or medical appropriateness, or 

based on whether the treatment is 

experimental or investigative; 

(B) Formulary design for prescription 

drugs; 

(C) For plans with multiple network 

tiers (such as preferred providers and 

participating providers), network tier 

design; 

(D) Standards related to network 

composition, including but not limited 

to, standards for provider and facility 

admission to participate in a network or 

for continued network participation, 

including methods for determining 

reimbursement rates, credentialing 

standards, and procedures for ensuring 

the network includes an adequate 

number of each category of provider and 

facility to provide services under the 

plan or coverage; 

(E) Plan or issuer methods for 

determining out-of-network rates, such 

as allowed amounts; usual, customary, 

and reasonable charges; or application 

of other external benchmarks for out-ofnetwork rates; 

(F) Refusal to pay for higher-cost 

therapies until it can be shown that a 

lower-cost therapy is not effective (also 

known as fail-first policies or step 

therapy protocols); 

(G) Exclusions based on failure to 

complete a course of treatment; and 

(H) Restrictions based on geographic 

location, facility type, provider 

specialty, and other criteria that limit 

the scope or duration of benefits for 

services provided under the plan or 

coverage. 

(iii) Required use of outcomes data— 

(A) In general. To ensure that a 

nonquantitative treatment limitation 

applicable to mental health or substance 

use disorder benefits in a classification, 

in operation, is no more restrictive than 

the predominant nonquantitative 

treatment limitation applied to 

substantially all medical/surgical 

benefits in the classification, a plan or 

issuer must collect and evaluate 

relevant data in a manner reasonably 

designed to assess the impact of the 

nonquantitative treatment limitation on 

relevant outcomes related to access to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits and carefully consider the 

impact as part of the plan’s or issuer’s 

evaluation. As part of its evaluation, the 

plan or issuer may not disregard 

relevant outcomes data that it knows or 

reasonably should know suggest that a 

nonquantitative treatment limitation is 

associated with material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. The 

Secretary, jointly with the Secretary of 

the Treasury and the Secretary of Health 

and Human Services, may specify in 

guidance the type, form, and manner of 

collection and evaluation for the data 

required under this paragraph 

(c)(4)(iii)(A). 

(1) Relevant data generally. For 

purposes of this paragraph (c)(4)(iii)(A), 

relevant data could include, as 

appropriate, but are not limited to, the 

number and percentage of claims 

denials and any other data relevant to 

the nonquantitative treatment limitation 

required by State law or private 

accreditation standards. 

(2) Relevant data for nonquantitative 

treatment limitations related to network 

composition. In addition to the relevant 

data set forth in paragraph 

(c)(4)(iii)(A)(1) of this section, relevant 

data for nonquantitative treatment 

limitations related to network 

composition could include, as 

appropriate, but are not limited to, innetwork and out-of-network utilization 

rates (including data related to provider 

claim submissions), network adequacy 

metrics (including time and distance 

data, and data on providers accepting 

new patients), and provider 

reimbursement rates (for comparable 

services and as benchmarked to a 

reference standard). 

(3) Unavailability of data. (i) If a plan 

or issuer newly imposes a 

nonquantitative treatment limitation for 

which relevant data is initially 

temporarily unavailable and the plan or 

issuer therefore cannot comply with this 

paragraph (c)(4)(iii)(A), the plan or 

issuer must include in its comparative 

analysis, as required under § 2590.712– 

1(c)(5)(i)(C), a detailed explanation of 

the lack of relevant data, the basis for 

the plan’s or issuer’s conclusion that 

there is a lack of relevant data, and 

when and how the data will become 

available and be collected and analyzed. 

Such a plan or issuer also must comply 

with this paragraph (c)(4)(iii)(A) as soon 

as practicable once relevant data 

becomes available. 

(ii) If a plan or issuer imposes a 

nonquantitative treatment limitation for 

which no data exist that can reasonably 

assess any relevant impact of the 

nonquantitative treatment limitation on 

relevant outcomes related to access to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits, the plan or issuer must include 

in its comparative analysis, as required 

under § 2590.712–1(c)(5)(i)(D), a 

reasoned justification as to the basis for 

the conclusion that there are no data 

that can reasonably assess the 

nonquantitative treatment limitation’s 

impact, why the nature of the 

nonquantitative treatment limitation 

prevents the plan or issuer from 

reasonably measuring its impact, an 

explanation of what data was 


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77726 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

the nonquantitative treatment limitation 

complies with this section. If a plan or 

issuer becomes aware of data that can 

reasonably assess any relevant impact of 

the nonquantitative treatment 

limitation, the plan or issuer must 

comply with this paragraph (c)(4)(iii)(A) 

as soon as practicable. 

(iii) Consistent with paragraph (a)(1) 

of this section, paragraphs 

(c)(4)(iii)(A)(3)(i) and (ii) of this section 

shall only apply in very limited 

circumstances and, where applicable, 

shall be construed narrowly. 

(B) Material differences. To the extent 

the relevant data evaluated under 

paragraph (c)(4)(iii)(A) of this section 

suggest that the nonquantitative 

treatment limitation contributes to 

material differences in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits in a classification, such 

differences will be considered a strong 

indicator that the plan or issuer violates 

this paragraph (c)(4). 

(1) Where the relevant data suggest 

that the nonquantitative treatment 

limitation contributes to material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits 

in a classification, the plan or issuer 

must take reasonable action, as 

necessary, to address the material 

differences to ensure compliance, in 

operation, with this paragraph (c)(4) and 

must document the actions that have 

been or are being taken by the plan or 

issuer to address material differences in 

access to mental health or substance use 

disorder benefits, as compared to 

medical/surgical benefits, as required by 

§ 2590.712–1(c)(5)(iv). 

(2) For purposes of this paragraph 

(c)(4)(iii)(B), relevant data are 

considered to suggest that the 

nonquantitative treatment limitation 

contributes to material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits if, based on all 

relevant facts and circumstances, and 

taking into account the considerations 

outlined in this paragraph 

(c)(4)(iii)(B)(2), the difference in the data 

suggests that the nonquantitative 

treatment limitation is likely to have a 

negative impact on access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

(i) Relevant facts and circumstances, 

for purposes of this paragraph 

(c)(4)(iii)(B)(2), may include, but are not 

limited to, the terms of the 

nonquantitative treatment limitation at 

issue, the quality or limitations of the 

data, causal explanations and analyses, 

evidence as to the recurring or nonrecurring nature of the results, and the 

magnitude of any disparities. 

(ii) Differences in access to mental 

health or substance use disorder 

benefits attributable to generally 

recognized independent professional 

medical or clinical standards or 

carefully circumscribed measures 

reasonably and appropriately designed 

to detect or prevent and prove fraud and 

abuse that minimize the negative impact 

on access to appropriate mental health 

and substance use disorder benefits, 

which are used as the basis for a factor 

or evidentiary standard used to design 

or apply a nonquantitative treatment 

limitation, are not considered to be 

material for purposes of this paragraph 

(c)(4)(iii)(B). To the extent a plan or 

issuer attributes any differences in 

access to the application of such 

standards or measures, the plan or 

issuer must explain the bases for that 

conclusion in the documentation 

prepared under § 2590.712– 

1(c)(5)(iv)(A). 

(C) Nonquantitative treatment 

limitations related to network 

composition. For purposes of applying 

paragraph (c)(4)(iii)(A) of this section 

with respect to nonquantitative 

treatment limitations related to network 

composition, a plan or issuer must 

collect and evaluate relevant data in a 

manner reasonably designed to assess 

the aggregate impact of all such 

nonquantitative treatment limitations on 

access to mental health and substance 

use disorder benefits and medical/ 

surgical benefits. Examples of possible 

actions that a plan or issuer could take 

to comply with the requirement under 

paragraph (c)(4)(iii)(B)(1) of this section 

to take reasonable action, as necessary, 

to address any material differences in 

access with respect to nonquantitative 

treatment limitations related to network 

composition, to ensure compliance with 

this paragraph (c)(4), include, but are 

not limited to: 

(1) Strengthening efforts to recruit and 

encourage a broad range of available 

mental health and substance use 

disorder providers and facilities to join 

the plan’s or issuer’s network of 

providers, including taking actions to 

increase compensation or other 

inducements, streamline credentialing 

processes, or contact providers 

reimbursed for items and services 

provided on an out-of-network basis to 

offer participation in the network; 

(2) Expanding the availability of 

telehealth arrangements to mitigate any 

overall mental health and substance use 

disorder provider shortages in a 

geographic area; 

(3) Providing additional outreach and 

assistance to participants and 

beneficiaries enrolled in the plan or 

coverage to assist them in finding 

available in-network mental health and 

substance use disorder providers and 

facilities; and 

(4) Ensuring that provider directories 

are accurate and reliable. 

(iv) Prohibition on separate 

nonquantitative treatment limitations 

applicable only to mental health or 

substance use disorder benefits. 

Consistent with paragraph (c)(2)(i) of 

this section, a group health plan (or 

health insurance coverage offered by an 

issuer in connection with such a plan) 

may not apply any nonquantitative 

treatment limitation that is applicable 

only with respect to mental health or 

substance use disorder benefits and 

does not apply with respect to any 

medical/surgical benefits in the same 

benefit classification. 

(v) Effect of final determination of 

noncompliance under § 2590.712–1. (A) 

If a group health plan (or health 

insurance issuer offering coverage in 

connection with a group health plan) 

receives a final determination from the 

Secretary that the plan or issuer is not 

in compliance with the requirements of 

ERISA section 712(a)(8) or § 2590.712– 

1 with respect to a nonquantitative 

treatment limitation, the 

nonquantitative treatment limitation 

violates this paragraph (c)(4) and the 

Secretary may direct the plan or issuer 

not to impose the nonquantitative 

treatment limitation with respect to 

mental health or substance use disorder 

benefits in the relevant classification, 

unless and until the plan or issuer 

demonstrates to the Secretary 

compliance with the requirements of 

this section or takes appropriate action 

to remedy the violation. 

(B) A determination by the Secretary 

of whether to require cessation of a 

nonquantitative treatment limitation 

under this paragraph (c)(4)(v) will be 

based on an evaluation of the relevant 

facts and circumstances involved in the 

specific final determination and the 

nature of the underlying 

nonquantitative treatment limitation 

and will take into account the interest 

of plan participants and beneficiaries 

and feedback from the plan or issuer. 

(vi) Examples. The rules of this 

paragraph (c)(4) are illustrated by the 

following examples. In each example, 

the group health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. 


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(A) Example 1 (not comparable and more 

stringent factors for reimbursement rate 

methodology, in operation)—(1) Facts. A 

plan’s reimbursement rate methodology for 

outpatient, in-network providers is based on 

a variety of factors. As written, for mental 

health, substance use disorder, and medical/ 

surgical benefits, all reimbursement rates for 

physicians and non-physician practitioners 

for the same Current Procedural Terminology 

(CPT) code are based on a combination of 

factors, such as the nature of the service, 

duration of the service, intensity and 

specialization of training, provider licensure 

and type, number of providers qualified to 

provide the service in a given geographic 

area, and market need (demand). In 

operation, the plan utilizes an additional 

strategy to further reduce reimbursement 

rates for mental health and substance use 

disorder non-physician providers from those 

paid to mental health and substance use 

disorder physicians by the same percentage 

for every CPT code, but does not apply the 

same reductions for non-physician medical/ 

surgical providers. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(A) (Example 1), the plan violates 

the rules of this paragraph (c)(4). Because the 

plan reimburses non-physician providers of 

mental health and substance use disorder 

services by reducing their reimbursement 

rate from the rate for physician providers of 

mental health and substance use disorder 

services by the same percentage for every 

CPT code but does not apply the same 

reductions to non-physician providers of 

medical/surgical services from the rate for 

physician providers of medical/surgical 

services, in operation, the factors used in 

designing and applying the nonquantitative 

treatment limitation to mental health and 

substance use disorder benefits in the 

outpatient, in-network classification are not 

comparable to, and are applied more 

stringently than, the factors used in designing 

and applying the limitation with respect to 

medical/surgical benefits in the same 

classification. As a result, the 

nonquantitative treatment limitation with 

respect to mental health or substance use 

disorder benefits in the outpatient, innetwork classification is more restrictive than 

the predominant nonquantitative treatment 

limitation that applies to substantially all 

medical/surgical benefits in the same 

classification. 

(B) Example 2 (strategy for exclusion for 

experimental or investigative treatment more 

stringently applied to ABA therapy in 

operation)—(1) Facts. A plan, as written, 

generally excludes coverage for all treatments 

that are experimental or investigative for both 

medical/surgical benefits and mental health 

and substance use disorder benefits in the 

outpatient, in-network classification. As a 

result, the plan generally excludes, as 

experimental, a treatment or procedure when 

no professionally recognized treatment 

guidelines include the treatment or 

procedure as a clinically appropriate 

standard of care for the condition or disorder 

and fewer than two randomized controlled 

trials are available to support the treatment’s 

use with respect to the given condition or 

disorder. The plan provides benefits for the 

treatment of ASD, which is a mental health 

condition, but, in operation, the plan 

excludes coverage for ABA therapy to treat 

children with ASD, deeming it experimental. 

More than one professionally recognized 

treatment guideline defines clinically 

appropriate standards of care for ASD and 

more than two randomized controlled trials 

are available to support the use of ABA 

therapy as one intervention to treat certain 

children with ASD. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(B) (Example 2), the plan violates the 

rules of this paragraph (c)(4). As written, the 

plan excludes coverage of experimental 

treatment of medical conditions and surgical 

procedures, mental health conditions, and 

substance use disorders when no 

professionally recognized treatment 

guidelines define clinically appropriate 

standards of care for the condition or 

disorder as including the treatment or 

procedure at issue, and fewer than two 

randomized controlled trials are available to 

support the treatment’s use with respect to 

the given condition or procedure. However, 

in operation, the plan deviates from this 

strategy with respect to ABA therapy because 

more than one professionally recognized 

treatment guideline defines clinically 

appropriate standards of care for ASD as 

including ABA therapy to treat certain 

children with ASD and more than two 

randomized controlled trials are available to 

support the use of ABA therapy to treat 

certain children with ASD. Therefore, in 

operation, the strategy used to design the 

nonquantitative treatment limitation for 

benefits for the treatment of ASD, which is 

a mental health condition, in the outpatient, 

in-network classification is not comparable 

to, and is applied more stringently than, the 

strategy used to design the nonquantitative 

treatment limitation for medical/surgical 

benefits in the same classification. As a 

result, the nonquantitative treatment 

limitation with respect to mental health or 

substance use disorder benefits in the 

outpatient, in-network classification is more 

restrictive than the predominant 

nonquantitative treatment limitation that 

applies to substantially all medical/surgical 

benefits in the same classification. 

(C) Example 3 (step therapy protocol with 

exception for severe or irreversible 

consequences, discriminatory factor)—(1) 

Facts. A plan’s written terms include a step 

therapy protocol that requires participants 

and beneficiaries who are prescribed certain 

drugs to try and fail a generic or preferred 

brand name drug before the plan will cover 

the drug originally prescribed by a 

participant’s or beneficiary’s attending 

provider. The plan provides an exception to 

this protocol that was developed solely based 

on a methodology developed by an external 

third-party organization. The third-party 

organization’s methodology, which is not 

based on a generally recognized independent 

professional medical or clinical standard, 

identifies instances in which a delay in 

treatment with a drug prescribed for a 

medical condition or surgical procedure 

could result in either severe or irreversible 

consequences. However, with respect to a 

drug prescribed for a mental health condition 

or a substance use disorder, the third-party 

organization’s methodology only identifies 

instances in which a delay in treatment could 

result in both severe and irreversible 

consequences, and the plan does not take any 

steps to correct, cure, or supplement the 

methodology. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(C) (Example 3), the plan violates the 

rules of paragraph (c)(4)(i)(B) of this section. 

The source upon which the factor used to 

apply the step therapy protocol is based is 

biased or not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits because it 

addresses instances in which a delay in 

treatment with a drug prescribed for a 

medical condition or surgical procedure 

could result in either severe or irreversible 

consequences, but only addresses instances 

in which a delay in treatment with a drug 

prescribed for a mental health condition or 

substance use disorder could result in both 

severe and irreversible consequences, and the 

plan fails to take the steps necessary to 

correct, cure, or supplement the methodology 

so that it is not biased and is objective. Based 

on the relevant facts and circumstances, this 

source systematically disfavors access or is 

specifically designed to disfavor access to 

mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits. Therefore, the factor used to apply 

the step therapy protocol is discriminatory 

for purposes of determining comparability 

and stringency under paragraph (c)(4)(i)(A) of 

this section, and may not be relied upon by 

the plan. 

(D) Example 4 (use of historical plan data 

and plan steps to correct, cure, or 

supplement)—(1) Facts. A plan’s 

methodology for calculating provider 

reimbursement rates relies only on historical 

plan data on total plan spending for each 

specialty, divided between mental health and 

substance use disorder providers and 

medical/surgical providers, from a time when 

the plan was not subject to ERISA section 

712. The plan has used these historical plan 

data for many years to establish base 

reimbursement rates in all provider 

specialties for which it provides medical/ 

surgical, mental health, and substance use 

disorder benefits in the inpatient, in-network 

classification. In evaluating the use of these 

historical plan data in the design of the 

methodology for calculating provider 

reimbursement rates, the plan determined, 

based on all the relevant facts and 

circumstances, that the historical plan data 

systematically disfavor access or are 

specifically designed to disfavor access to 

mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits. To ensure this information about 

historical reimbursement rates is not biased 

and is objective, the plan supplements its 

methodology to develop the base 

reimbursement rates for mental health and 

substance use disorder providers in 

accordance with additional information, 

evidence, sources, and standards that reflect 

the increased demand for mental health and 

substance use disorder benefits in the 

inpatient, in-network classification and to 


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attract sufficient mental health and substance 

use disorder providers to the network, so that 

the relevant facts and circumstances indicate 

the supplemented information, evidence, 

sources, or standards do not systematically 

disfavor access and are not specifically 

designed to disfavor access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(D) (Example 4), the plan does not 

violate the rules of paragraph (c)(4)(i)(B) of 

this section with respect to the plan’s 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification. The relevant facts and 

circumstances indicate that the plan’s use of 

only historical plan data to design its 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification would otherwise be 

considered to be biased or not objective in a 

manner that discriminates against mental 

health or substance use disorder benefits as 

compared to medical/surgical benefits under 

paragraph (c)(4)(i)(B)(2) of this section, since 

the historical data systematically disfavor 

access or are specifically designed to disfavor 

access to mental health or substance use 

disorder benefits as compared to medical/ 

surgical benefits. However, the plan took the 

steps necessary to supplement the 

information, evidence, sources, and 

standards to reasonably reflect the increased 

demand for mental health and substance use 

disorder benefits in the inpatient, in-network 

classification, and adjust the methodology to 

increase reimbursement rates for those 

benefits, thereby ensuring that the 

information, evidence, sources, and 

standards relied upon by the plan for this 

purpose are not biased and are objective. 

Therefore, the factors and evidentiary 

standards used to design the plan’s 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification are not discriminatory. 

(E) Example 5 (generally recognized 

independent professional medical or clinical 

standards and more stringent prior 

authorization requirement in operation)—(1) 

Facts. The provisions of a plan state that it 

relies on, and does not deviate from, 

generally recognized independent 

professional medical or clinical standards to 

inform the factor used to design prior 

authorization requirements for both medical/ 

surgical and mental health and substance use 

disorder benefits in the prescription drug 

classification. The generally recognized 

independent professional medical standard 

for treatment of opioid use disorder that the 

plan utilizes—in this case, the American 

Society of Addiction Medicine national 

practice guidelines—does not support prior 

authorization every 30 days for 

buprenorphine/naloxone. However, in 

operation, the plan requires prior 

authorization for buprenorphine/naloxone 

combination for treatment of opioid use 

disorder, every 30 days, which is 

inconsistent with the generally recognized 

independent professional medical standard 

on which the factor used to design the 

limitation is based. The plan’s factor used to 

design prior authorization requirements for 

medical/surgical benefits in the prescription 

drug classification relies on, and does not 

deviate from, generally recognized 

independent professional medical or clinical 

standards. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(E) (Example 5), the plan violates the 

rules of this paragraph (c)(4). The American 

Society of Addiction Medicine national 

practice guidelines on which the factor used 

to design prior authorization requirements 

for substance use disorder benefits is based 

are generally recognized independent 

professional medical or clinical standards 

that are not considered to be biased or not 

objective in a manner that discriminates 

against mental health and substance use 

disorder benefits under paragraph 

(c)(4)(i)(B)(3) of this section. However, the 

plan must comply with other requirements in 

this paragraph (c)(4), as applicable, with 

respect to such standards or measures that 

are used as the basis for a factor or 

evidentiary standard used to design or apply 

a nonquantitative treatment limitation. In 

operation, the plan’s factor used to design 

and apply prior authorization requirements 

with respect to substance use disorder 

benefits is not comparable to, and is applied 

more stringently than, the same factor used 

to design and apply prior authorization 

requirements for medical/surgical benefits, 

because the factor relies on, and does not 

deviate from, generally recognized 

independent professional medical or clinical 

standards for medical/surgical benefits, but 

deviates from the relevant guidelines for 

substance use disorder benefits. As a result, 

the nonquantitative treatment limitation with 

respect to substance use disorder benefits in 

the prescription drug classification is more 

restrictive than the predominant 

nonquantitative treatment limitation that 

applies to substantially all medical/surgical 

benefits in the same classification. 

(F) Example 6 (plan claims no data exist 

to reasonably assess impact of 

nonquantitative treatment limitation on 

access; medical necessity criteria)—(1) Facts. 

A plan approves or denies claims for mental 

health and substance use disorder benefits 

and for medical/surgical benefits in the 

inpatient, in-network and outpatient, innetwork classifications based on medical 

necessity criteria. The plan states in its 

comparative analysis that no data exist that 

can reasonably assess any relevant impact of 

the medical necessity criteria nonquantitative 

treatment limitation on relevant outcomes 

related to access to mental health or 

substance use disorder benefits as compared 

to the plan’s medical necessity criteria 

nonquantitative treatment limitation’s impact 

on relevant outcomes related to access to 

medical/surgical benefits in the relevant 

classifications, without further explanation. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(F) (Example 6), the plan violates 

this paragraph (c)(4). The plan does not 

comply with paragraph (c)(4)(iii)(A)(3)(ii) of 

this section because the plan did not include 

in its comparative analysis, as required under 

§ 2590.712–1(c)(5)(i)(D), a reasoned 

justification as to the basis for its conclusion 

that there are no data that can reasonably 

assess the nonquantitative treatment 

limitation’s impact, an explanation of why 

the nature of the nonquantitative treatment 

limitation prevents the plan from reasonably 

measuring its impact, an explanation of what 

data was considered and rejected, and 

documentation of any additional safeguards 

or protocols used to ensure the 

nonquantitative treatment limitation 

complies with this paragraph (c)(4). Data that 

could reasonably assess the medical 

necessity criteria nonquantitative treatment 

limitation’s impact might include, for 

example, the number and percentage of 

claims denials, or the number and percentage 

of claims that were approved for a lower 

level of care than the level requested on the 

initial claim. Therefore, because the plan has 

not collected and evaluated relevant data in 

a manner reasonably designed to assess the 

impact of the nonquantitative treatment 

limitation on relevant outcomes related to 

access to mental health and substance use 

disorder benefits and medical/surgical 

benefits in the relevant classifications, the 

plan violates the requirements of paragraph 

(c)(4)(iii) of this section, and violates the 

requirements under § 2590.712–1(c)(5)(i)(D) 

because it did not include sufficient 

information in its comparative analysis with 

respect to the lack of relevant data. 

(G) Example 7 (concurrent review data 

collection; no material difference in access)— 

(1) Facts. A plan follows a written process to 

apply a concurrent review nonquantitative 

treatment limitation to all medical/surgical 

benefits and mental health and substance use 

disorder benefits within the inpatient, innetwork classification. Under this process, a 

first-level review is conducted in every 

instance in which concurrent review applies 

and an authorization request is approved by 

the first-level reviewer only if the clinical 

information submitted by the facility meets 

the plan’s criteria for a continued stay. If the 

first-level reviewer is unable to approve the 

authorization request because the clinical 

information submitted by the facility does 

not meet the plan’s criteria for a continued 

stay, it is sent to a second-level reviewer who 

will either approve or deny the request. The 

plan collects relevant data, including the 

number of referrals to second-level review, 

and the number of denials of claims for 

medical/surgical benefits and mental health 

and substance use disorder benefits subject to 

concurrent review as compared to the total 

number of claims subject to concurrent 

review, in the inpatient, in-network 

classification. The plan also collects and 

evaluates the number of denied claims for 

medical/surgical benefits and mental health 

and substance use disorder benefits that are 

overturned on appeal in the inpatient, innetwork classification. The plan evaluates 

the relevant data and determines that, based 

on the relevant facts and circumstances, the 

data do not suggest that the concurrent 

review nonquantitative treatment limitation 

contributes to material differences in access 

to mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits in the classification Upon requesting 

the plan’s comparative analysis for the 

concurrent review nonquantitative treatment 

limitation and reviewing the relevant data, 

the Secretary does not request additional data 


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and agrees that the data do not suggest 

material differences in access. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(G) (Example 7), the plan does not 

violate the rules of paragraph (c)(4)(iii) of this 

section. The plan collected and evaluated 

relevant data in a manner reasonably 

designed to assess the impact of the 

nonquantitative treatment limitation on 

relevant outcomes related to access to mental 

health and substance use disorder benefits 

and medical/surgical benefits and considered 

the impact as part of its evaluation. Because 

the relevant data evaluated do not suggest 

that the nonquantitative treatment limitation 

contributes to material differences in access 

to mental health and substance use disorder 

benefits as compared to medical/surgical 

benefits in the inpatient, in-network 

classification, under paragraph (c)(4)(iii)(B) 

of this section, there is no strong indicator 

that the plan violates this paragraph (c)(4). 

(H) Example 8 (material difference in 

access for prior authorization requirement 

with reasonable action)—(1) Facts. A plan 

requires prior authorization that a treatment 

is medically necessary for all inpatient, innetwork medical/surgical benefits and for all 

inpatient, in-network mental health and 

substance use disorder benefits. The plan 

collects and evaluates relevant data in a 

manner reasonably designed to assess the 

impact of the prior authorization requirement 

on relevant outcomes related to access to 

mental health and substance use disorder 

benefits and medical/surgical benefits in the 

inpatient, in-network classification. The 

plan’s written process for prior authorization 

states that the plan approves inpatient, innetwork benefits for medical conditions and 

surgical procedures and mental health and 

substance use disorder benefits for periods of 

1, 3, and 7 days, after which a treatment plan 

must be submitted by the patient’s attending 

provider and approved by the plan. 

Approvals for mental health and substance 

use disorder benefits are most commonly 

given only for 1 day, after which a treatment 

plan must be submitted by the patient’s 

attending provider and approved by the plan. 

The relevant data show that approvals for 7 

days are most common for medical 

conditions and surgical procedures under 

this plan. Based on all the relevant facts and 

circumstances, the difference in the relevant 

data suggests that the nonquantitative 

treatment limitation is likely to have a 

negative impact on access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

Therefore, the data suggest that the 

nonquantitative treatment limitation 

contributes to material differences in access. 

To address these material differences in 

access, the plan consults more recent medical 

guidelines to update the factors that inform 

its medical necessity nonquantitative 

treatment limitations. Based on this review, 

the plan modifies the limitation so that 

inpatient, in-network prior authorization 

requests for mental health or substance use 

disorder benefits are approved for similar 

periods to what is approved for medical/ 

surgical benefits. The plan includes 

documentation of this action as part of its 

comparative analysis. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(H) (Example 8), the plan does not 

violate the rules of paragraph (c)(4)(iii) of this 

section. While relevant data for the plan’s 

prior authorization requirements suggested 

that the nonquantitative treatment limitation 

contributes to material differences in access 

to mental health and substance use disorder 

benefits as compared to inpatient, in-network 

medical/surgical benefits under paragraph 

(c)(4)(iii)(B) of this section, the plan has 

taken reasonable action, as necessary, to 

ensure compliance, in operation, with this 

paragraph (c)(4) by updating the factors that 

inform its prior authorization 

nonquantitative treatment limitation for 

inpatient, in-network mental health and 

substance use disorder benefits so that these 

benefits are approved for similar periods to 

what is approved for medical/surgical 

benefits. The plan also documents its action 

taken to address material differences in 

access to inpatient, in-network benefits as 

required by paragraph (c)(4)(iii)(B)(1) of this 

section. 

(I) Example 9 (differences attributable to 

generally recognized independent 

professional medical or clinical standards)— 

(1) Facts. A group health plan develops a 

medical management requirement for all 

inpatient, out-of-network benefits for both 

medical/surgical benefits and mental health 

and substance use disorder benefits to ensure 

treatment is medically necessary. The factors 

and evidentiary standards used to design and 

apply the medical management requirement 

rely on independent professional medical or 

clinical standards that are generally 

recognized by health care providers and 

facilities in relevant clinical specialties. The 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the medical management 

requirement to mental health and substance 

use disorder benefits are comparable to, and 

are applied no more stringently than, the 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the requirement with respect to 

medical/surgical benefits. The plan collects 

and evaluates relevant data in a manner 

reasonably designed to assess the impact of 

the medical management nonquantitative 

treatment limitation on relevant outcomes 

related to access to mental health and 

substance use disorder benefits and medical/ 

surgical benefits, and considers the impact as 

part of the plan’s evaluation, as required by 

paragraph (c)(4)(iii)(A) of this section. Within 

the inpatient, out-of-network classification, 

the application of the medical management 

requirement results in a higher percentage of 

denials for mental health and substance use 

disorder claims than medical/surgical claims, 

because the benefits were found to be 

medically necessary for a lower percentage of 

mental health and substance use disorder 

claims. The plan correctly determines that 

these differences in access are attributable to 

the generally recognized independent 

professional medical or clinical standards 

used as the basis for the factors and 

evidentiary standards used to design or apply 

the limitation and adequately explains the 

bases for that conclusion as part of its 

comparative analysis. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(I) (Example 9), the plan does not 

violate the rules of this paragraph (c)(4). 

Generally recognized independent 

professional medical or clinical standards of 

care are not considered to be information, 

evidence, sources, or standards that are 

biased and not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits, and the plan 

otherwise complies with the requirements in 

paragraph (c)(4)(i) of this section. 

Additionally, the plan does not violate 

paragraph (c)(4)(iii) of this section because it 

has collected and evaluated relevant data, the 

differences in access are attributable to the 

generally recognized independent 

professional medical or clinical standards 

that are used as the basis for the factors and 

evidentiary standards used to design or apply 

the medical management nonquantitative 

treatment limitation, and the plan explains 

the bases for this conclusion in its 

comparative analysis. As a result, the 

nonquantitative treatment limitation with 

respect to mental health or substance use 

disorder benefits in the inpatient, out-ofnetwork classification is no more restrictive 

than the predominant nonquantitative 

treatment limitation that applies to 

substantially all medical/surgical benefits in 

the same classification. 

(J) Example 10 (material differences in 

access for standards for provider admission 

to a network with reasonable action)—(1) 

Facts. A plan applies nonquantitative 

treatment limitations related to network 

composition in the inpatient, in-network and 

outpatient, in-network classifications. The 

plan’s networks are constructed by separate 

service providers for medical/surgical 

benefits and mental health and substance use 

disorder benefits. The processes, strategies, 

evidentiary standards, and other factors used 

in designing and applying the 

nonquantitative treatment limitations related 

to network composition for mental health or 

substance use disorder benefits in the 

outpatient, in-network and inpatient, innetwork classifications are comparable to, 

and are applied no more stringently than, the 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the nonquantitative treatment 

limitations with respect to medical/surgical 

benefits in the classifications, as required 

under paragraph (c)(4)(i) of this section. In 

order to ensure, in operation, that the 

nonquantitative treatment limitations are no 

more restrictive than the predominant 

nonquantitative treatment limitations applied 

to substantially all medical/surgical benefits 

in the classification, the plan collects and 

evaluates relevant data in a manner 

reasonably designed to assess the aggregate 

impact of all the nonquantitative treatment 

limitations related to network composition 

on relevant outcomes related to access to 

mental health and substance use disorder 

benefits as compared with access to medical/ 

surgical benefits and considers the impact as 

part of the plan’s evaluation. The plan 

considers relevant data that is known, or 

reasonably should be known, including 

metrics relating to the time and distance from 


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plan participants and beneficiaries to 

network providers in rural and urban regions; 

the number of network providers accepting 

new patients; the proportions of mental 

health and substance use disorder and 

medical/surgical providers and facilities that 

provide services in rural and urban regions 

who are in the plan’s network; provider 

reimbursement rates (for comparable services 

and benchmarked to a reference standard, as 

appropriate); and in-network and out-ofnetwork utilization rates (including data 

related to the dollar value and number of 

provider claims submissions). The plan 

determines that the relevant data suggest that 

the nonquantitative treatment limitations in 

the aggregate contribute to material 

differences in access to mental health and 

substance use disorder benefits compared to 

medical/surgical benefits in the 

classifications because, based on all the 

relevant facts and circumstances, the 

differences in the data suggest that the 

nonquantitative treatment limitations related 

to network composition are likely to have a 

negative impact on access to mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits. The plan takes 

reasonable actions, as necessary, to address 

the material differences in access, to ensure 

compliance, in operation, with this 

paragraph (c)(4), by strengthening its efforts 

to recruit and encourage a broad range of 

available providers and facilities to join the 

plan’s network of providers, including by 

taking actions to increase compensation and 

other inducements, streamline credentialing 

processes, contact providers reimbursed for 

items and services provided on an out-ofnetwork basis to offer participation in the 

network, and develop a process to monitor 

the effects of such efforts; expanding the 

availability of telehealth arrangements to 

mitigate overall provider shortages in certain 

geographic areas; providing additional 

outreach and assistance to participants and 

beneficiaries enrolled in the plan to assist 

them in finding available in-network 

providers and facilities; and ensuring that the 

plan’s provider directories are accurate and 

reliable. The plan documents the efforts that 

it has taken to address the material 

differences in access that the data revealed, 

and the plan includes the documentation as 

part of its comparative analysis submission. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(J) (Example 10), the plan does not 

violate the rules of this paragraph (c)(4). The 

plan’s nonquantitative treatment limitations 

related to network composition comply with 

the rules of paragraph (c)(4)(i) of this section. 

Additionally, the plan collects and evaluates 

relevant data, as required under paragraph 

(c)(4)(iii)(A) of this section, in a manner 

reasonably designed to assess the aggregate 

impact of all such nonquantitative treatment 

limitations on relevant outcomes related to 

access to mental health and substance use 

disorder benefits and medical/surgical 

benefits, as required under paragraph 

(c)(4)(iii)(C) of this section. While the data 

suggest that the nonquantitative treatment 

limitations contribute to material differences 

in access to mental health and substance use 

disorder benefits as compared to medical/ 

surgical benefits, the plan has taken 

reasonable action, as necessary, to ensure 

compliance with this paragraph (c)(4). The 

plan also documents the actions that have 

been and are being taken by the plan to 

address material differences as required by 

§ 2590.712–1(c)(5)(iv). As a result, the 

network composition nonquantitative 

treatment limitations with respect to mental 

health or substance use disorder benefits in 

the inpatient, in-network and outpatient, innetwork classifications are no more 

restrictive than the predominant 

nonquantitative treatment limitations that 

apply to substantially all medical/surgical 

benefits in the same classifications. 

(K) Example 11 (separate EAP exhaustion 

treatment limitation applicable only to 

mental health or substance use disorder 

benefits)—(1) Facts. An employer maintains 

both a major medical plan and an employee 

assistance program (EAP). The EAP provides, 

among other benefits, a limited number of 

mental health or substance use disorder 

counseling sessions, which, together with 

other benefits provided by the EAP, are not 

significant benefits in the nature of medical 

care. Participants are eligible for mental 

health or substance use disorder benefits 

under the major medical plan only after 

exhausting the counseling sessions provided 

by the EAP. No similar exhaustion 

requirement applies with respect to medical/ 

surgical benefits provided under the major 

medical plan. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(K) (Example 11), the requirement 

that limits eligibility for mental health and 

substance use disorder benefits under the 

major medical plan until EAP benefits are 

exhausted is a nonquantitative treatment 

limitation subject to the parity requirements 

of this paragraph (c)(4). Because the 

limitation does not apply to medical/surgical 

benefits, it is a separate nonquantitative 

treatment limitation applicable only to 

mental health and substance use disorder 

benefits that violates paragraph (c)(4)(iv) of 

this section. Additionally, this EAP would 

not qualify as excepted benefits under 

§ 2590.732(c)(3)(vi)(B)(1) because 

participants in the major medical plan are 

required to use and exhaust benefits under 

the EAP (making the EAP a gatekeeper) 

before an individual is eligible for benefits 

under the plan. 

(L) Example 12 (separate exclusion for 

treatment in a residential facility applicable 

only to mental health and substance use 

disorder benefits)—(1) Facts. A plan 

generally covers inpatient, in-network and 

inpatient, out-of-network treatment without 

any limitations on setting, including skilled 

nursing facilities and rehabilitation hospitals, 

provided other medical necessity standards 

are satisfied. The plan has an exclusion for 

treatment at residential facilities, which the 

plan defines as an inpatient benefit for 

mental health and substance use disorder 

benefits. This exclusion was not generated 

through any broader nonquantitative 

treatment limitation (such as medical 

necessity or other clinical guideline). 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(L) (Example 12), the plan violates 

the rules of paragraph (c)(4)(iv) of this 

section. The exclusion of treatment at 

residential facilities is a separate 

nonquantitative treatment limitation 

applicable only to mental health and 

substance use disorder benefits in the 

inpatient, in-network and inpatient, out-ofnetwork classifications because the plan does 

not apply a comparable exclusion with 

respect to any medical/surgical benefits in 

the same benefit classification. 

(M) Example 13 (impermissible 

nonquantitative treatment limitation 

imposed following a final determination of 

noncompliance and direction by the 

Secretary)—(1) Facts. Following an initial 

request by the Secretary for a plan’s 

comparative analysis of the plan’s exclusion 

of mental health and substance use disorder 

benefits for failure to complete a course of 

treatment in the inpatient, in-network 

classification under § 2590.712–1(d), the plan 

submits a comparative analysis for the 

nonquantitative treatment limitation. After 

review of the comparative analysis, as well 

as additional information submitted by the 

plan after the Secretary determines that the 

plan has not submitted sufficient information 

to be responsive to the request, the Secretary 

makes an initial determination that the 

comparative analysis fails to demonstrate 

that the processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits in the 

inpatient, in-network classification are 

comparable to, and applied no more 

stringently than, those used in designing and 

applying the limitation to medical/surgical 

benefits in the classification. Under 

§ 2590.712–1(d)(3), the plan submits a 

corrective action plan and additional 

comparative analyses within 45 calendar 

days after the initial determination. However, 

the corrective action plan does not alter or 

eliminate the exclusion or alter the processes, 

strategies, evidentiary standards, and other 

factors used in designing and applying the 

exclusion. Moreover, the additional 

comparative analysis still does not include 

sufficient information. The Secretary then 

determines that the additional comparative 

analyses do not demonstrate compliance 

with the requirements of this paragraph 

(c)(4). Accordingly, the plan receives a final 

determination of noncompliance with ERISA 

section 712(a)(8) and § 2590.712–1 from the 

Secretary, which concludes that the plan did 

not demonstrate compliance through the 

comparative analysis process. After 

considering the relevant facts and 

circumstances, and considering the interests 

of plan participants and beneficiaries, as well 

as feedback from the plan, the Secretary 

directs the plan not to impose the 

nonquantitative treatment limitation by a 

certain date, unless and until the plan 

demonstrates compliance to the Secretary or 

takes appropriate action to remedy the 

violation. The plan makes no changes to its 

plan terms by that date and continues to 

impose the exclusion of benefits for failure to 

complete a course of treatment in the 

inpatient, in-network classification. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(M) (Example 13), by continuing to 

impose the exclusion of mental health and 


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substance use disorder benefits for failure to 

complete a course of treatment in the 

inpatient, in-network classification after the 

Secretary directs the plan not to impose this 

nonquantitative treatment limitation, the 

plan violates the requirements of paragraph 

(c)(4)(v) of this section. 

* * * * * 

(d) * * * 

(3) Provisions of other law. 

Compliance with the disclosure 

requirements in paragraphs (d)(1) and 

(2) of this section is not determinative 

of compliance with any other provision 

of applicable Federal or State law. In 

particular, in addition to those 

disclosure requirements, provisions of 

other applicable law require disclosure 

of information relevant to medical/ 

surgical, mental health, and substance 

use disorder benefits. For example, 

ERISA section 104 and § 2520.104b–1 of 

this chapter provide that, for plans 

subject to ERISA, instruments under 

which the plan is established or 

operated must generally be furnished to 

plan participants within 30 days of 

request. Instruments under which the 

plan is established or operated include 

documents with information on medical 

necessity criteria for both medical/ 

surgical benefits and mental health and 

substance use disorder benefits; 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; and the comparative analyses 

and other applicable information 

required by § 2590.712–1. In addition, 

§ 2560.503–1 of this chapter and 

§ 2590.715–2719 set forth rules 

regarding claims and appeals, including 

the right of claimants (or their 

authorized representative) who have 

received an adverse benefit 

determination (or a final internal 

adverse benefit determination) to be 

provided, upon request and free of 

charge, reasonable access to and copies 

of all documents, records, and other 

information relevant to the claimant’s 

claim for benefits. This includes 

documents 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 and the comparative analyses 

and other applicable information 

required by § 2590.712–1. 

(e) * * * 

(4) Coordination with EHB 

requirements. Nothing in paragraph (f) 

or (g) of this section or § 2590.712–1(g) 

changes the requirements of 45 CFR 

147.150 and 156.115 providing that a 

health insurance issuer offering nongrandfathered health insurance coverage 

in the individual or small group market 

that is required to provide mental health 

and substance use disorder services, 

including behavioral health treatment 

services, as part of essential health 

benefits required under 45 CFR 

156.110(a)(5) and 156.115(a), must 

comply with the requirements under 

section 2726 of the Public Health 

Service Act and its implementing 

regulations at 45 CFR 146.136 and 

146.137 to satisfy the requirement to 

provide coverage for mental health and 

substance use disorder services, 

including behavioral health treatment, 

as part of essential health benefits. 

* * * * * 

(i) * * * 

(1) In general. Except as provided in 

paragraph (i)(2) of this section— 

(i) This section applies to group 

health plans and health insurance 

issuers offering group health insurance 

coverage on the first day of the first plan 

year beginning on or after January 1, 

2025, except that the requirements of 

paragraphs (c)(2)(ii)(A), (c)(4)(i)(B), and 

(c)(4)(iii) of this section apply on the 

first day of the first plan year beginning 

on or after January 1, 2026. 

(ii) Until the applicability date in 

paragraph (i)(1)(i) of this section, plans 

and issuers are required to continue to 

comply with 29 CFR 2590.712, revised 

as of July 1, 2022. 

* * * * * 

(j) Severability. If any provision of this 

section is held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, or stayed 

pending further agency action, the 

provision shall be construed so as to 

continue to give the maximum effect to 

the provision permitted by law, unless 

such holding shall be one of invalidity 

or unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

■ 6. Add § 2590.712–1 to read as 

follows: 

§ 2590.712–1 Nonquantitative treatment 

limitation comparative analysis 

requirements. 

(a) Meaning of terms. Unless 

otherwise stated in this section, the 

terms of this section have the meanings 

indicated in § 2590.712(a)(2). 

(b) In general. In the case of a group 

health plan (or health insurance issuer 

offering coverage in connection with a 

group health plan) that provides both 

medical/surgical benefits and mental 

health or substance use disorder 

benefits and that imposes any 

nonquantitative treatment limitation on 

mental health or substance use disorder 

benefits, the plan or issuer must perform 

and document a comparative analysis of 

the design and application of each 

nonquantitative treatment limitation 

applicable to mental health or substance 

use disorder benefits. Each comparative 

analysis must comply with the content 

requirements of paragraph (c) of this 

section and be made available to the 

Secretary, upon request, in the manner 

required by paragraphs (d) and (e) of 

this section. 

(c) Comparative analysis content 

requirements. With respect to each 

nonquantitative treatment limitation 

applicable to mental health or substance 

use disorder benefits under a group 

health plan (or health insurance 

coverage offered in connection with a 

group health plan), the comparative 

analysis performed by the plan or issuer 

must include, at minimum, the elements 

specified in this paragraph (c). In 

addition to the comparative analysis for 

each nonquantitative treatment 

limitation, each plan or issuer must 

prepare and make available to the 

Secretary, upon request, a written list of 

all nonquantitative treatment limitations 

imposed under the plan or coverage, 

which must be provided to the named 

fiduciaries of the plan who are required 

to include a certification as part of each 

comparative analysis, as required under 

paragraph (c)(6)(vi) of this section. 

(1) Description of the nonquantitative 

treatment limitation. The comparative 

analysis must include, with respect to 

the nonquantitative treatment limitation 

that is the subject of the comparative 

analysis: 

(i) Identification of the 

nonquantitative treatment limitation, 

including the specific terms of the plan 

or coverage or other relevant terms 

regarding the nonquantitative treatment 

limitation, the policies or guidelines 

(internal or external) in which the 

nonquantitative treatment limitation 

appears or is described, and the 

applicable sections of any other relevant 

documents, such as provider contracts, 

that describe the nonquantitative 

treatment limitation; 

(ii) Identification of all mental health 

or substance use disorder benefits and 

medical/surgical benefits to which the 

nonquantitative treatment limitation 

applies, including a list of which 

benefits are considered mental health or 


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substance use disorder benefits and 

which benefits are considered medical/ 

surgical benefits; and 

(iii) A description of which benefits 

are included in each classification set 

forth in § 2590.712(c)(2)(ii)(A). 

(2) Identification and definition of the 

factors and evidentiary standards used 

to design or apply the nonquantitative 

treatment limitation. The comparative 

analysis must include, with respect to 

every factor considered or relied upon 

to design the nonquantitative treatment 

limitation or apply the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits and 

medical/surgical benefits: 

(i) Identification of every factor 

considered or relied upon, as well as the 

evidentiary standards considered or 

relied upon to design or apply each 

factor and the sources from which each 

evidentiary standard was derived, in 

determining which mental health or 

substance use disorder benefits and 

which medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; and 

(ii) A definition of each factor, 

including: 

(A) A detailed description of the 

factor; 

(B) A description of each evidentiary 

standard used to design or apply each 

factor (and the source of each 

evidentiary standard) identified under 

paragraph (c)(2)(i) of this section; and 

(C) A description of any steps the plan 

or issuer has taken to correct, cure, or 

supplement any information, evidence, 

sources, or standards that would 

otherwise have been considered biased 

or not objective under 

§ 2590.712(c)(4)(i)(B)(1) in the absence 

of such steps. 

(3) Description of how factors are 

used in the design and application of 

the nonquantitative treatment 

limitation. The comparative analysis 

must include a description of how each 

factor identified and defined under 

paragraph (c)(2) of this section is used 

in the design or application of the 

nonquantitative treatment limitation to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits in a classification, including: 

(i) A detailed explanation of how each 

factor identified and defined in 

paragraph (c)(2) of this section is used 

to determine which mental health or 

substance use disorder benefits and 

which medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; 

(ii) An explanation of the evidentiary 

standards or other information or 

sources (if any) considered or relied 

upon in designing or applying the 

factors or relied upon in designing and 

applying the nonquantitative treatment 

limitation, including in the 

determination of whether and how 

mental health or substance use disorder 

benefits or medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; 

(iii) If the application of the factor 

depends on specific decisions made in 

the administration of benefits, the 

nature of the decisions, the timing of the 

decisions, and the professional 

designations and qualifications of each 

decision maker; 

(iv) If more than one factor is 

identified and defined in paragraph 

(c)(2) of this section, an explanation of: 

(A) How all of the factors relate to 

each other; 

(B) The order in which all the factors 

are applied, including when they are 

applied; 

(C) Whether and how any factors are 

given more weight than others; and 

(D) The reasons for the ordering or 

weighting of the factors; and 

(v) Any deviations or variations from 

a factor, its applicability, or its 

definition (including the evidentiary 

standards used to define the factor and 

the information or sources from which 

each evidentiary standard was derived), 

such as how the factor is used 

differently to apply the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

and a description of how the plan or 

issuer establishes such deviations or 

variations. 

(4) Demonstration of comparability 

and stringency as written. The 

comparative analysis must evaluate 

whether, in any classification, under the 

terms of the plan (or health insurance 

coverage) as written, any processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the nonquantitative treatment 

limitation to mental health or substance 

use disorder benefits are comparable to, 

and are applied no more stringently 

than, the processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

nonquantitative treatment limitation 

with respect to medical/surgical 

benefits. The comparative analysis must 

include, with respect to the 

nonquantitative treatment limitation 

and the factors used in designing and 

applying the nonquantitative treatment 

limitation: 

(i) Documentation of each factor 

identified and defined in paragraph 

(c)(2) of this section that was applied to 

determine whether the nonquantitative 

treatment limitation applies to mental 

health or substance use disorder 

benefits and medical/surgical benefits in 

a classification, including, as relevant: 

(A) Quantitative data, calculations, or 

other analyses showing whether, in each 

classification in which the 

nonquantitative treatment limitation 

applies, mental health or substance use 

disorder benefits and medical/surgical 

benefits met or did not meet any 

applicable threshold identified in the 

relevant evidentiary standard to 

determine that the nonquantitative 

treatment limitation would or would not 

apply; and 

(B) Records maintained by the plan or 

issuer documenting the consideration 

and application of all factors and 

evidentiary standards, as well as the 

results of their application; 

(ii) In each classification in which the 

nonquantitative treatment limitation 

applies to mental health or substance 

use disorder benefits, a comparison of 

how the nonquantitative treatment 

limitation, as written, is designed and 

applied to mental health or substance 

use disorder benefits and to medical/ 

surgical benefits, including the specific 

provisions of any forms, checklists, 

procedure manuals, or other 

documentation used in designing and 

applying the nonquantitative treatment 

limitation or that address the 

application of the nonquantitative 

treatment limitation; 

(iii) Documentation demonstrating 

how the factors are comparably applied, 

as written, to mental health or substance 

use disorder benefits and medical/ 

surgical benefits in each classification, 

to determine which benefits are subject 

to the nonquantitative treatment 

limitation; and 

(iv) An explanation of the reasons for 

any deviations or variations in the 

application of a factor used to apply the 

nonquantitative treatment limitation, or 

the application of the nonquantitative 

treatment limitation, to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

and how the plan or issuer establishes 

such deviations or variations, including: 

(A) In the definition of the factors, the 

evidentiary standards used to define the 

factors, and the sources from which the 

evidentiary standards were derived; 

(B) In the design of the factors or 

evidentiary standards; or 

(C) In the application or design of the 

nonquantitative treatment limitation. 

(5) Demonstration of comparability 

and stringency in operation. The 

comparative analysis must evaluate 

whether, in any classification, in 

operation, the processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 


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nonquantitative treatment limitation to 

mental health or substance use disorder 

benefits are comparable to, and are 

applied no more stringently than, the 

processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the limitation 

with respect to medical/surgical 

benefits. The comparative analysis must 

include, with respect to the 

nonquantitative treatment limitation 

and the factors used in designing and 

applying the nonquantitative treatment 

limitation: 

(i) A comprehensive explanation of 

how the plan or issuer evaluates 

whether, in operation, the processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the nonquantitative treatment 

limitation to mental health or substance 

use disorder benefits in a classification 

are comparable to, and are applied no 

more stringently than, the processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the nonquantitative treatment 

limitation with respect to medical/ 

surgical benefits, including: 

(A) An explanation of any 

methodology and underlying data used 

to demonstrate the application of the 

nonquantitative treatment limitation, in 

operation; 

(B) The sample period, inputs used in 

any calculations, definitions of terms 

used, and any criteria used to select the 

mental health or substance use disorder 

benefits and medical/surgical benefits to 

which the nonquantitative treatment 

limitation is applicable; 

(C) With respect to a nonquantitative 

treatment limitation for which relevant 

data is temporarily unavailable as 

described in 

§ 2590.712(c)(4)(iii)(A)(3)(i), a detailed 

explanation of the lack of relevant data, 

the basis for the plan’s or issuer’s 

conclusion that there is a lack of 

relevant data, and when and how the 

data will become available and be 

collected and analyzed; and 

(D) With respect to a nonquantitative 

treatment limitation for which no data 

exist that can reasonably assess any 

relevant impact of the nonquantitative 

treatment limitation on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits as 

described in 

§ 2590.712(c)(4)(iii)(A)(3)(ii), a reasoned 

justification as to the basis for the 

conclusion that there are no data that 

can reasonably assess the 

nonquantitative treatment limitation’s 

impact, an explanation of why the 

nature of the nonquantitative treatment 

limitation prevents the plan or issuer 

from reasonably measuring its impact, 

an explanation of what data was 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

that the nonquantitative treatment 

limitation complies with 

§ 2590.712(c)(4); 

(ii) Identification of the relevant data 

collected and evaluated, as required 

under § 2590.712(c)(4)(iii)(A); 

(iii) Documentation of the outcomes 

that resulted from the application of the 

nonquantitative treatment limitation to 

mental health or substance use disorder 

benefits and medical/surgical benefits, 

including: 

(A) The evaluation of relevant data as 

required under § 2590.712(c)(4)(iii)(A); 

and 

(B) A reasoned justification and 

analysis that explains why the plan or 

issuer concluded that any differences in 

the relevant data do or do not suggest 

the nonquantitative treatment limitation 

contributes to material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, in accordance 

with § 2590.712(c)(4)(iii)(B)(2); 

(iv) A detailed explanation of any 

material differences in access 

demonstrated by the outcomes 

evaluated under paragraph (c)(5)(iii) of 

this section, including: 

(A) A reasoned explanation of any 

material differences in access that are 

not attributable to differences in the 

comparability or relative stringency of 

the nonquantitative treatment limitation 

as applied to mental health or substance 

use disorder benefits and medical/ 

surgical benefits (including any 

considerations beyond a plan’s or 

issuer’s control that contribute to the 

existence of material differences) and a 

detailed explanation of the bases for 

concluding that material differences are 

not attributable to differences in the 

comparability or relative stringency of 

the nonquantitative treatment 

limitation; and 

(B) To the extent differences in access 

to mental health or substance use 

disorder benefits are attributable to 

generally recognized independent 

professional medical or clinical 

standards or carefully circumscribed 

measures reasonably and appropriately 

designed to detect or prevent and prove 

fraud and abuse that minimize the 

negative impact on access to appropriate 

mental health and substance use 

disorder benefits, and such standards or 

measures are used as the basis for a 

factor or evidentiary standard used to 

design or apply a nonquantitative 

treatment limitation, documentation 

explaining how any such differences are 

attributable to those standards or 

measures, as required in 

§ 2590.712(c)(4)(iii)(B)(2)(ii); and 

(v) A discussion of the actions that 

have been or are being taken by the plan 

or issuer to address any material 

differences in access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

including the actions the plan or issuer 

has taken or is taking under 

§ 2590.712(c)(4)(iii)(B)(1) to address 

material differences to comply, in 

operation, with § 2590.712(c)(4), 

including, as applicable: 

(A) A reasoned explanation of any 

material differences in access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits that persist despite 

reasonable actions that have been or are 

being taken; and 

(B) For a plan or issuer designing and 

applying one or more nonquantitative 

treatment limitations related to network 

composition, a discussion of the actions 

that have been or are being taken to 

address material differences in access to 

in-network mental health and substance 

use disorder benefits as compared to innetwork medical/surgical benefits, 

including those listed in 

§ 2590.712(c)(4)(iii)(C). 

(6) Findings and conclusions. The 

comparative analysis must address the 

findings and conclusions as to the 

comparability of the processes, 

strategies, evidentiary standards, and 

other factors used in designing and 

applying the nonquantitative treatment 

limitation to mental health or substance 

use disorder benefits and medical/ 

surgical benefits within each 

classification, and the relative 

stringency of their application, both as 

written and in operation, and include: 

(i) Any findings or conclusions 

indicating that the plan or coverage is or 

is not (or might or might not be) in 

compliance with the requirements of 

§ 2590.712(c)(4), including any 

additional actions the plan or issuer has 

taken or intends to take to address any 

potential areas of concern or 

noncompliance; 

(ii) A reasoned and detailed 

discussion of the findings and 

conclusions described in paragraph 

(c)(6)(i) of this section; 

(iii) Citations to any additional 

specific information not otherwise 

included in the comparative analysis 

that supports the findings and 

conclusions described in paragraph 

(c)(6)(i) of this section not otherwise 

discussed in the comparative analysis; 

(iv) The date the analysis is 

completed and the title and credentials 

of all relevant persons who participated 


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in the performance and documentation 

of the comparative analysis; 

(v) If the comparative analysis relies 

upon an evaluation by a reviewer or 

consultant considered by the plan or 

issuer to be an expert, an assessment of 

each expert’s qualifications and the 

extent to which the plan or issuer 

ultimately relied upon each expert’s 

evaluation in performing and 

documenting the comparative analysis 

of the design and application of the 

nonquantitative treatment limitation 

applicable to both mental health or 

substance use disorder benefits and 

medical/surgical benefits; and 

(vi) A certification by one or more 

named fiduciaries that they have 

engaged in a prudent process to select 

one or more qualified service providers 

to perform and document a comparative 

analysis in connection with the 

imposition of any nonquantitative 

treatment limitations that apply to 

mental health and substance use 

disorder benefits under the plan in 

accordance with applicable law and 

regulations, and have satisfied their 

duty to monitor those service providers 

as required under part 4 of ERISA with 

respect to the performance and 

documentation of such comparative 

analysis. 

(d) Requirements related to 

submission of comparative analyses to 

the Secretary upon request—(1) Initial 

request by the Secretary for comparative 

analysis. A group health plan (or health 

insurance issuer offering coverage in 

connection with a group health plan) 

must make the comparative analysis 

required by paragraph (b) of this section 

available and submit it to the Secretary 

within 10 business days of receipt of a 

request from the Secretary (or an 

additional period of time specified by 

the Secretary). 

(2) Additional information required 

after a comparative analysis is deemed 

to be insufficient. In instances in which 

the Secretary determines that the plan 

or issuer has not submitted sufficient 

information under paragraph (d)(1) of 

this section for the Secretary to 

determine whether the comparative 

analysis required in paragraph (b) of this 

section complies with paragraph (c) of 

this section or whether the plan or 

issuer complies with § 2590.712(c)(4), 

the Secretary will specify to the plan or 

issuer the additional information the 

plan or issuer must submit to the 

Secretary to be responsive to the request 

under paragraph (d)(1). Any such 

information must be provided to the 

Secretary by the plan or issuer within 10 

business days after the Secretary 

specifies the additional information to 

be submitted (or an additional period of 

time specified by the Secretary). 

(3) Initial determination of 

noncompliance, required action, and 

corrective action plan. In instances in 

which the Secretary reviewed the 

comparative analysis submitted under 

paragraph (d)(1) of this section and any 

additional information submitted under 

paragraph (d)(2) of this section, and 

made an initial determination that the 

plan or issuer is not in compliance with 

the requirements of § 2590.712(c)(4) or 

this section, the plan or issuer must 

respond to the initial determination by 

the Secretary and specify the actions the 

plan or issuer will take to bring the plan 

or coverage into compliance, and 

provide to the Secretary additional 

comparative analyses meeting the 

requirements of paragraph (c) of this 

section that demonstrate compliance 

with § 2590.712(c)(4), not later than 45 

calendar days after the Secretary’s 

initial determination that the plan or 

issuer is not in compliance. 

(4) Requirement to notify participants 

and beneficiaries of final determination 

of noncompliance—(i) In general. If the 

Secretary makes a final determination of 

noncompliance, the plan or issuer must 

notify all participants and beneficiaries 

enrolled in the plan or coverage that the 

plan or issuer has been determined to 

not be in compliance with the 

requirements of § 2590.712(c)(4) or this 

section with respect to such plan or 

coverage. Such notice must be provided 

within 7 business days of receipt of the 

final determination of noncompliance, 

and the plan or issuer must provide a 

copy of the notice to the Secretary, any 

service provider involved in the claims 

process, and any fiduciary responsible 

for deciding benefit claims within the 

same timeframe. 

(ii) Content of notice. The notice to 

participants and beneficiaries required 

in paragraph (d)(4)(i) of this section 

shall be written in a manner calculated 

to be understood by the average plan 

participant and must include, in plain 

language, the following information in a 

standalone notice: 

(A) The following statement 

prominently displayed on the first page, 

in no less than 14-point font: 

‘‘Attention! The Department of Labor 

has determined that [insert the name of 

group health plan or health insurance 

issuer] is not in compliance with the 

Mental Health Parity and Addiction 

Equity Act.’’; 

(B) A summary of changes the plan or 

issuer has made as part of its corrective 

action plan specified to the Secretary 

following the initial determination of 

noncompliance, including an 

explanation of any opportunity for a 

participant or beneficiary to have a 

claim for benefits submitted or 

reprocessed; 

(C) A summary of the Secretary’s final 

determination that the plan or issuer is 

not in compliance with § 2590.712(c)(4) 

or this section, including any provisions 

or practices identified as being in 

violation of § 2590.712(c)(4) or this 

section, additional corrective actions 

identified by the Secretary in the final 

determination notice, and information 

on how participants and beneficiaries 

can obtain from the plan or issuer a 

copy of the final determination of 

noncompliance; 

(D) Any additional actions the plan or 

issuer is taking to come into compliance 

with § 2590.712(c)(4) or this section, 

when the plan or issuer will take such 

actions, and a clear and accurate 

statement explaining whether the 

Secretary has concurred with those 

actions; and 

(E) Contact information for questions 

and complaints, and a statement 

explaining how participants and 

beneficiaries can obtain more 

information about the notice, including: 

(1) The plan’s or issuer’s phone 

number and an email or web portal 

address; and 

(2) The Employee Benefits Security 

Administration’s phone number and 

email or web portal address. 

(iii) Manner of notice. The plan or 

issuer must make the notice required 

under paragraph (d)(4)(i) of this section 

available in paper form, or 

electronically (such as by email or an 

internet posting) if: 

(A) The format is readily accessible; 

(B) The notice is provided in paper 

form free of charge upon request; and 

(C) In a case in which the electronic 

form is an internet posting, the plan or 

issuer timely notifies the participant or 

beneficiary in paper form (such as a 

postcard) or email, that the documents 

are available on the internet, provides 

the internet address, includes the 

statement required in paragraph 

(d)(4)(ii)(A) of this section, and notifies 

the participant or beneficiary that the 

documents are available in paper form 

upon request. 

(e) Requests for a copy of a 

comparative analysis. In addition to 

making a comparative analysis available 

upon request to the Secretary, a plan or 

issuer must make available a copy of the 

comparative analysis required by 

paragraph (b) of this section when 

requested by: 

(1) Any applicable State authority; 

(2) A participant or beneficiary 

(including a provider or other person 

acting as a participant’s or beneficiary’s 

authorized representative) who has 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77735 

received an adverse benefit 

determination related to mental health 

or substance use disorder benefits; and 

(3) Participants and beneficiaries, who 

may request the comparative analysis at 

any time under ERISA section 104. 

(f) Rule of construction. Nothing in 

this section or § 2590.712 shall be 

construed to prevent the Secretary from 

acting within the scope of existing 

authorities to address violations of 

§ 2590.712 or this section. 

(g) Applicability. The provisions of 

this section apply to group health plans 

and health insurance issuers offering 

group health insurance coverage 

described in § 2590.712(e), to the extent 

the plan or issuer is not exempt under 

§ 2590.712(f) or (g), on the first day of 

the first plan year beginning on or after 

January 1, 2025, except the 

requirements of paragraphs (c)(2)(ii)(C), 

(c)(5)(i)(C) and (D), and (c)(5)(ii) through 

(v) of this section apply on the first day 

of the first plan year beginning on or 

after January 1, 2026. 

(h) Severability. If any provision of 

this section is held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, or stayed 

pending further agency action, the 

provision shall be construed so as to 

continue to give the maximum effect to 

the provision permitted by law, unless 

such holding shall be one of invalidity 

or unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

Department of Health and Human 

Services 

For the reasons set forth in the 

preamble, the Department of Health and 

Human Services amends 45 CFR parts 

146 and 147 as set forth below: 

PART 146—REQUIREMENTS FOR THE 

GROUP HEALTH INSURANCE 

MARKET 

■ 7. The authority citation for part 146 

continues to read as follows: 

Authority: 42 U.S.C. 300gg–1 through 

300gg–5, 300gg–11 through 300gg–23, 300gg– 

91, and 300gg–92. 

■ 8. Amend § 146.136 by: 

■ a. Redesignating paragraph (a) as 

paragraph (a)(2) and adding paragraphs 

(a) heading and (a)(1); 

■ b. In newly redesignated paragraph 

(a)(2): 

■ i. Revising the introductory text; 

■ ii. Adding the definitions of ‘‘DSM,’’ 

‘‘Evidentiary standards,’’ ‘‘Factors,’’ and 

‘‘ICD’’ in alphabetical order; 

■ iii. Revising the definitions of 

‘‘Medical/surgical benefits’’ and 

‘‘Mental health benefits’’; 

■ iv. Adding the definitions of 

‘‘Processes’’ and ‘‘Strategies’’ in 

alphabetical order; and 

■ v. Revising the definitions of 

‘‘Substance use disorder benefits’’ and 

‘‘Treatment limitations’’; 

■ c. Revising paragraphs (c)(1)(ii), 

(c)(2)(i), (c)(2)(ii)(A) introductory text, 

(c)(2)(ii)(C), and (c)(3)(i)(A), (C), and (D); 

■ d. In paragraph (c)(3)(iii), adding 

introductory text; 

■ e. Revising paragraphs (c)(3)(iii)(A) 

and (B), (c)(3)(iv), (c)(4), (d)(3), (e)(4), 

and (i)(1); and 

■ f. Adding paragraph (j). 

The revisions and additions read as 

follows: 

§ 146.136 Parity in mental health and 

substance use disorder benefits. 

(a) Purpose and meaning of terms— 

(1) Purpose. This section and § 146.137 

set forth rules to ensure parity in 

aggregate lifetime and annual dollar 

limits, financial requirements, and 

quantitative and nonquantitative 

treatment limitations between mental 

health and substance use disorder 

benefits and medical/surgical benefits, 

as required under PHS Act section 2726. 

A fundamental purpose of PHS Act 

section 2726, this section, and § 146.137 

is to ensure that participants and 

beneficiaries in a group health plan (or 

health insurance coverage offered by an 

issuer in connection with a group health 

plan) that offers mental health or 

substance use disorder benefits are not 

subject to more restrictive aggregate 

lifetime or annual dollar limits, 

financial requirements, or treatment 

limitations with respect to those 

benefits than the predominant dollar 

limits, financial requirements, or 

treatment limitations that are applied to 

substantially all medical/surgical 

benefits covered by the plan or coverage 

in the same classification, as further 

provided in this section and § 146.137. 

Accordingly, in complying with the 

provisions of PHS Act section 2726, this 

section, and § 146.137, plans and issuers 

must not design or apply financial 

requirements and treatment limitations 

that impose a greater burden on access 

(that is, are more restrictive) to mental 

health or substance use disorder 

benefits under the plan or coverage than 

they impose on access to medical/ 

surgical benefits in the same 

classification of benefits. The provisions 

of PHS Act section 2726, this section, 

and § 146.137 should be interpreted in 

a manner that is consistent with the 

purpose described in this paragraph 

(a)(1). 

(2) Meaning of terms. For purposes of 

this section and § 146.137, except where 

the context clearly indicates otherwise, 

the following terms have the meanings 

indicated: 

* * * * * 

DSM means the American Psychiatric 

Association’s Diagnostic and Statistical 

Manual of Mental Disorders. For the 

purpose of this definition, the most 

current version of the DSM as of 

November 22, 2024, is the Diagnostic 

and Statistical Manual of Mental 

Disorders, Fifth Edition, Text Revision 

published in March 2022. A subsequent 

version of the DSM published after 

November 22, 2024, will be considered 

the most current version beginning on 

the first day of the plan year that is one 

year after the date the subsequent 

version is published. 

Evidentiary standards are any 

evidence, sources, or standards that a 

group health plan (or health insurance 

issuer offering coverage in connection 

with such a plan) considered or relied 

upon in designing or applying a factor 

with respect to a nonquantitative 

treatment limitation, including specific 

benchmarks or thresholds. Evidentiary 

standards may be empirical, statistical, 

or clinical in nature, and include: 

sources acquired or originating from an 

objective third party, such as recognized 

medical literature, professional 

standards and protocols (which may 

include comparative effectiveness 

studies and clinical trials), published 

research studies, payment rates for 

items and services (such as publicly 

available databases of the ‘‘usual, 

customary and reasonable’’ rates paid 

for items and services), and clinical 

treatment guidelines; internal plan or 

issuer data, such as claims or utilization 

data or criteria for assuring a sufficient 

mix and number of network providers; 

and benchmarks or thresholds, such as 

measures of excessive utilization, cost 

levels, time or distance standards, or 

network participation percentage 

thresholds. 

Factors are all information, including 

processes and strategies (but not 

evidentiary standards), that a group 

health plan (or health insurance issuer 

offering coverage in connection with 

such a plan) considered or relied upon 

to design a nonquantitative treatment 

limitation, or to determine whether or 

how the nonquantitative treatment 

limitation applies to benefits under the 

plan or coverage. Examples of factors 

include, but are not limited to: provider 

discretion in determining a diagnosis or 

type or length of treatment; clinical 

efficacy of any proposed treatment or 

service; licensing and accreditation of 


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77736 Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 

providers; claim types with a high 

percentage of fraud; quality measures; 

treatment outcomes; severity or 

chronicity of condition; variability in 

the cost of an episode of treatment; high 

cost growth; variability in cost and 

quality; elasticity of demand; and 

geographic location. 

* * * * * 

ICD means the World Health 

Organization’s International 

Classification of Diseases adopted by the 

Department of Health and Human 

Services through § 162.1002 of this 

subtitle. For the purpose of this 

definition, the most current version of 

the ICD as of November 22, 2024, is the 

International Classification of Diseases, 

10th Revision, Clinical Modification 

adopted for the period beginning on 

October 1, 2015. Any subsequent 

version of the ICD adopted through 

§ 162.1002 of this subtitle after 

November 22, 2024, will be considered 

the most current version beginning on 

the first day of the plan year that is one 

year after the date the subsequent 

version is adopted. 

Medical/surgical benefits means 

benefits with respect to items or services 

for medical conditions or surgical 

procedures, as defined under the terms 

of the group health plan (or health 

insurance coverage offered by an issuer 

in connection with such a plan) and in 

accordance with applicable Federal and 

State law, but does not include mental 

health benefits or substance use 

disorder benefits. Notwithstanding the 

preceding sentence, any condition or 

procedure defined by the plan or 

coverage as being or as not being a 

medical condition or surgical procedure 

must be defined consistent with 

generally recognized independent 

standards of current medical practice 

(for example, the most current version 

of the ICD). To the extent generally 

recognized independent standards of 

current medical practice do not address 

whether a condition or procedure is a 

medical condition or surgical 

procedure, plans and issuers may define 

the condition or procedure in 

accordance with applicable Federal and 

State law. 

Mental health benefits means benefits 

with respect to items or services for 

mental health conditions, as defined 

under the terms of the group health plan 

(or health insurance coverage offered by 

an issuer in connection with such a 

plan) and in accordance with applicable 

Federal and State law, but does not 

include medical/surgical benefits or 

substance use disorder benefits. 

Notwithstanding the preceding 

sentence, any condition defined by the 

plan or coverage as being or as not being 

a mental health condition must be 

defined consistent with generally 

recognized independent standards of 

current medical practice. For the 

purpose of this definition, to be 

consistent with generally recognized 

independent standards of current 

medical practice, the definition must 

include all conditions covered under 

the plan or coverage, except for 

substance use disorders, that fall under 

any of the diagnostic categories listed in 

the mental, behavioral, and 

neurodevelopmental disorders chapter 

(or equivalent chapter) of the most 

current version of the ICD or that are 

listed in the most current version of the 

DSM. To the extent generally recognized 

independent standards of current 

medical practice do not address whether 

a condition is a mental health condition, 

plans and issuers may define the 

condition in accordance with applicable 

Federal and State law. 

Processes are actions, steps, or 

procedures that a group health plan (or 

health insurance issuer offering 

coverage in connection with such a 

plan) uses to apply a nonquantitative 

treatment limitation, including actions, 

steps, or procedures established by the 

plan or issuer as requirements in order 

for a participant or beneficiary to access 

benefits, including through actions by a 

participant’s or beneficiary’s authorized 

representative or a provider or facility. 

Examples of processes include, but are 

not limited to: procedures to submit 

information to authorize coverage for an 

item or service prior to receiving the 

benefit or while treatment is ongoing 

(including requirements for peer or 

expert clinical review of that 

information); provider referral 

requirements that are used to determine 

when and how a participant or 

beneficiary may access certain services; 

and the development and approval of a 

treatment plan used in a concurrent 

review process to determine whether a 

specific request should be granted or 

denied. Processes also include the 

specific procedures used by staff or 

other representatives of a plan or issuer 

(or the service provider of a plan or 

issuer) to administer the application of 

nonquantitative treatment limitations, 

such as how a panel of staff members 

applies the nonquantitative treatment 

limitation (including the qualifications 

of staff involved, number of staff 

members allocated, and time allocated), 

consultations with panels of experts in 

applying the nonquantitative treatment 

limitation, and the degree of reviewer 

discretion in adhering to criteria 

hierarchy when applying a 

nonquantitative treatment limitation. 

Strategies are practices, methods, or 

internal metrics that a plan (or health 

insurance issuer offering coverage in 

connection with such a plan) considers, 

reviews, or uses to design a 

nonquantitative treatment limitation. 

Examples of strategies include, but are 

not limited to: the development of the 

clinical rationale used in approving or 

denying benefits; the method of 

determining whether and how to 

deviate from generally accepted 

standards of care in concurrent reviews; 

the selection of information deemed 

reasonably necessary to make medical 

necessity determinations; reliance on 

treatment guidelines or guidelines 

provided by third-party organizations in 

the design of a nonquantitative 

treatment limitation; and rationales 

used in selecting and adopting certain 

threshold amounts to apply a 

nonquantitative treatment limitation, 

professional standards and protocols to 

determine utilization management 

standards, and fee schedules used to 

determine provider reimbursement 

rates, used as part of a nonquantitative 

treatment limitation. Strategies also 

include the method of creating and 

determining the composition of the staff 

or other representatives of a plan or 

issuer (or the service provider of a plan 

or issuer) that deliberates, or otherwise 

makes decisions, on the design of 

nonquantitative treatment limitations, 

including the plan’s or issuer’s methods 

for making decisions related to the 

qualifications of staff involved, number 

of staff members allocated, and time 

allocated; breadth of sources and 

evidence considered; consultations with 

panels of experts in designing the 

nonquantitative treatment limitation; 

and the composition of the panels used 

to design a nonquantitative treatment 

limitation. 

Substance use disorder benefits 

means benefits with respect to items or 

services for substance use disorders, as 

defined under the terms of the group 

health plan (or health insurance 

coverage offered by an issuer in 

connection with such a plan) and in 

accordance with applicable Federal and 

State law, but does not include medical/ 

surgical benefits or mental health 

benefits. Notwithstanding the preceding 

sentence, any disorder defined by the 

plan or coverage as being or as not being 

a substance use disorder must be 

defined consistent with generally 

recognized independent standards of 

current medical practice. For the 

purpose of this definition, to be 

consistent with generally recognized 

independent standards of current 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77737 

medical practice, the definition must 

include all disorders covered under the 

plan or coverage that fall under any of 

the diagnostic categories listed as a 

mental or behavioral disorder due to 

psychoactive substance use (or 

equivalent category) in the mental, 

behavioral, and neurodevelopmental 

disorders chapter (or equivalent 

chapter) of the most current version of 

the ICD or that are listed as a SubstanceRelated and Addictive Disorder (or 

equivalent category) in the most current 

version of the DSM. To the extent 

generally recognized independent 

standards of current medical practice do 

not address whether a disorder is a 

substance use disorder, plans and 

issuers may define the disorder in 

accordance with applicable Federal and 

State law. 

Treatment limitations include limits 

on benefits based on the frequency of 

treatment, number of visits, days of 

coverage, days in a waiting period, or 

other similar limits on the scope or 

duration of treatment. Treatment 

limitations include both quantitative 

treatment limitations, which are 

expressed numerically (such as 50 

outpatient visits per year), and 

nonquantitative treatment limitations 

(such as standards related to network 

composition), which otherwise limit the 

scope or duration of benefits for 

treatment under a plan or coverage. (See 

paragraph (c)(4)(ii) of this section for an 

illustrative, non-exhaustive list of 

nonquantitative treatment limitations.) 

A complete exclusion of all benefits for 

a particular condition or disorder, 

however, is not a treatment limitation 

for purposes of this definition. 

* * * * * 

(c) * * * 

(1) * * * 

(ii) Type of financial requirement or 

treatment limitation. When reference is 

made in this paragraph (c) to a type of 

financial requirement or treatment 

limitation, the reference to type means 

its nature. Different types of financial 

requirements include deductibles, 

copayments, coinsurance, and out-ofpocket maximums. Different types of 

quantitative treatment limitations 

include annual, episode, and lifetime 

day and visit limits. See paragraph 

(c)(4)(ii) of this section for an 

illustrative, non-exhaustive list of 

nonquantitative treatment limitations. 

* * * * * 

(2) * * * 

(i) General rule. A group health plan 

(or health insurance coverage offered by 

an issuer in connection with a group 

health plan) that provides both medical/ 

surgical benefits and mental health or 

substance use disorder benefits may not 

apply any financial requirement or 

treatment limitation to mental health or 

substance use disorder benefits in any 

classification that is more restrictive 

than the predominant financial 

requirement or treatment limitation of 

that type applied to substantially all 

medical/surgical benefits in the same 

classification. Whether a financial 

requirement or treatment limitation is a 

predominant financial requirement or 

treatment limitation that applies to 

substantially all medical/surgical 

benefits in a classification is determined 

separately for each type of financial 

requirement or treatment limitation. A 

plan or issuer may not impose any 

financial requirement or treatment 

limitation that is applicable only with 

respect to mental health or substance 

use disorder benefits and not to any 

medical/surgical benefits in the same 

benefit classification. The application of 

the rules of this paragraph (c)(2) to 

financial requirements and quantitative 

treatment limitations is addressed in 

paragraph (c)(3) of this section; the 

application of the rules of this 

paragraph (c)(2) to nonquantitative 

treatment limitations is addressed in 

paragraph (c)(4) of this section. 

(ii) * * * 

(A) In general. If a plan (or health 

insurance coverage) provides any 

benefits for a mental health condition or 

substance use disorder in any 

classification of benefits described in 

this paragraph (c)(2)(ii), it must provide 

meaningful benefits for that mental 

health condition or substance use 

disorder in every classification in which 

medical/surgical benefits are provided. 

For purposes of this paragraph 

(c)(2)(ii)(A), whether the benefits 

provided are meaningful benefits is 

determined in comparison to the 

benefits provided for medical 

conditions and surgical procedures in 

the classification and requires, at a 

minimum, coverage of benefits for that 

condition or disorder in each 

classification in which the plan (or 

coverage) provides benefits for one or 

more medical conditions or surgical 

procedures. A plan (or coverage) does 

not provide meaningful benefits under 

this paragraph (c)(2)(ii)(A) unless it 

provides benefits for a core treatment for 

that condition or disorder in each 

classification in which the plan (or 

coverage) provides benefits for a core 

treatment for one or more medical 

conditions or surgical procedures. For 

purposes of this paragraph (c)(2)(ii)(A), 

a core treatment for a condition or 

disorder is a standard treatment or 

course of treatment, therapy, service, or 

intervention indicated by generally 

recognized independent standards of 

current medical practice. If there is no 

core treatment for a covered mental 

health condition or substance use 

disorder with respect to a classification, 

the plan (or coverage) is not required to 

provide benefits for a core treatment for 

such condition or disorder in that 

classification (but must provide benefits 

for such condition or disorder in every 

classification in which medical/surgical 

benefits are provided). In determining 

the classification in which a particular 

benefit belongs, a plan (or health 

insurance issuer) must apply the same 

standards to medical/surgical benefits 

and to mental health or substance use 

disorder benefits. To the extent that a 

plan (or health insurance coverage) 

provides benefits in a classification and 

imposes any separate financial 

requirement or treatment limitation (or 

separate level of a financial requirement 

or treatment limitation) for benefits in 

the classification, the rules of this 

paragraph (c) apply separately with 

respect to that classification for all 

financial requirements or treatment 

limitations (illustrated in examples in 

paragraph (c)(2)(ii)(C) of this section). 

The following classifications of benefits 

are the only classifications used in 

applying the rules of this paragraph (c), 

in addition to the permissible subclassifications described in paragraph 

(c)(3)(iii) of this section: 

* * * * * 

(C) Examples. The rules of this 

paragraph (c)(2)(ii) are illustrated by the 

following examples. In each example, 

the group health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. With regard to the 

examples in this paragraph (c)(2)(ii)(C), 

references to any particular core 

treatment are included for illustrative 

purposes only. Plans and issuers must 

consult generally recognized 

independent standards of current 

medical practice to determine the 

applicable core treatment, therapy, 

service, or intervention for any covered 

condition or disorder. 

(1) Example 1—(i) Facts. A group health 

plan offers inpatient and outpatient benefits 

and does not contract with a network of 

providers. The plan imposes a $500 

deductible on all benefits. For inpatient 

medical/surgical benefits, the plan imposes a 

coinsurance requirement. For outpatient 

medical/surgical benefits, the plan imposes 

copayments. The plan imposes no other 

financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(1) (Example 1), because the plan 

has no network of providers, all benefits 

provided are out-of-network. Because 


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inpatient, out-of-network medical/surgical 

benefits are subject to separate financial 

requirements from outpatient, out-of-network 

medical/surgical benefits, the rules of this 

paragraph (c) apply separately with respect to 

any financial requirements and treatment 

limitations, including the deductible, in each 

classification. 

(2) Example 2—(i) Facts. A plan imposes 

a $500 deductible on all benefits. The plan 

has no network of providers. The plan 

generally imposes a 20 percent coinsurance 

requirement with respect to all benefits, 

without distinguishing among inpatient, 

outpatient, emergency care, or prescription 

drug benefits. The plan imposes no other 

financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(2) (Example 2), because the plan 

does not impose separate financial 

requirements (or treatment limitations) based 

on classification, the rules of this paragraph 

(c) apply with respect to the deductible and 

the coinsurance across all benefits. 

(3) Example 3—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(2)(i) of this section 

(Example 2), except the plan exempts 

emergency care benefits from the 20 percent 

coinsurance requirement. The plan imposes 

no other financial requirements or treatment 

limitations. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(3) (Example 3), because the plan 

imposes separate financial requirements 

based on classifications, the rules of this 

paragraph (c) apply with respect to the 

deductible and the coinsurance separately for 

benefits in the emergency care classification 

and all other benefits. 

(4) Example 4—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(2)(i) of this section 

(Example 2), except the plan also imposes a 

preauthorization requirement for all inpatient 

treatment in order for benefits to be paid. No 

such requirement applies to outpatient 

treatment. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(4) (Example 4), because the plan 

has no network of providers, all benefits 

provided are out-of-network. Because the 

plan imposes a separate treatment limitation 

based on classifications, the rules of this 

paragraph (c) apply with respect to the 

deductible and coinsurance separately for 

inpatient, out-of-network benefits and all 

other benefits. 

(5) Example 5—(i) Facts. A plan covers 

treatment for autism spectrum disorder 

(ASD), a mental health condition, and covers 

outpatient, out-of-network developmental 

screenings for ASD but excludes all other 

benefits for outpatient treatment for ASD, 

including applied behavior analysis (ABA) 

therapy, when provided on an out-of-network 

basis. The plan generally covers the full 

range of outpatient treatments (including 

core treatments) and treatment settings for 

medical conditions and surgical procedures 

when provided on an out-of-network basis. 

Under the generally recognized independent 

standards of current medical practice 

consulted by the plan, developmental 

screenings alone do not constitute a core 

treatment for ASD. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(5) (Example 5), the plan violates 

the rules of this paragraph (c)(2)(ii). Although 

the plan covers benefits for ASD in the 

outpatient, out-of-network classification, it 

only covers developmental screenings, so it 

does not cover a core treatment for ASD in 

the classification. Because the plan generally 

covers the full range of medical/surgical 

benefits, including a core treatment for one 

or more medical conditions or surgical 

procedures in the classification, it fails to 

provide meaningful benefits for treatment of 

ASD in the classification. 

(6) Example 6—(i) Facts. Same facts as in 

paragraph (c)(2)(ii)(C)(5) of this section 

(Example 5), except that the plan is an HMO 

that does not cover the full range of medical/ 

surgical benefits including a core treatment 

for any medical conditions or surgical 

procedures in the outpatient, out-of-network 

classification (except as required under PHS 

Act sections 2799A–1 and 2799A–2), but 

covers benefits for medical conditions and 

surgical procedures in the inpatient, innetwork; outpatient, in-network; emergency 

care; and prescription drug classifications. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(6) (Example 6), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

Because the plan does not provide 

meaningful benefits including for a core 

treatment for any medical condition or 

surgical procedure in the outpatient, out-ofnetwork classification (except as required 

under PHS Act sections 2799A–1 and 

2799A–2), the plan is not required to provide 

meaningful benefits for any mental health 

conditions or substance use disorders in that 

classification. Nevertheless, the plan must 

provide meaningful benefits for each mental 

health condition and substance use disorder 

for which the plan provides benefits in every 

classification in which meaningful medical/ 

surgical benefits are provided as required 

under paragraph (c)(2)(ii)(A) of this section. 

This example does not address whether the 

plan has complied with other applicable 

requirements of this section in excluding 

coverage of ABA therapy in the outpatient, 

out-of-network classification. 

(7) Example 7—(i) Facts. A plan provides 

extensive benefits, including for core 

treatments for many medical conditions and 

surgical procedures in the outpatient, innetwork classification, including nutrition 

counseling for diabetes and obesity. The plan 

also generally covers diagnosis and treatment 

for eating disorders, which are mental health 

conditions, including coverage for nutrition 

counseling to treat eating disorders in the 

outpatient, in-network classification. 

Nutrition counseling is a core treatment for 

eating disorders, in accordance with 

generally recognized independent standards 

of current medical practice consulted by the 

plan. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(7) (Example 7), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

The coverage of diagnosis and treatment for 

eating disorders, including nutrition 

counseling, in the outpatient, in-network 

classification results in the plan providing 

meaningful benefits for the treatment of 

eating disorders in the classification, as 

determined in comparison to the benefits 

provided for medical conditions or surgical 

procedures in the classification. 

(8) Example 8—(i) Facts. A plan provides 

extensive benefits for the core treatments for 

many medical conditions and surgical 

procedures in the outpatient, in-network and 

prescription drug classifications. The plan 

provides coverage for diagnosis and 

treatment for opioid use disorder, a substance 

use disorder, in the outpatient, in-network 

classification, by covering counseling and 

behavioral therapies and, in the prescription 

drug classification, by covering medications 

to treat opioid use disorder (MOUD). 

Counseling and behavioral therapies and 

MOUD, in combination, are one of the core 

treatments for opioid use disorder, in 

accordance with generally recognized 

independent standards of current medical 

practice consulted by the plan. 

(ii) Conclusion. In this paragraph 

(c)(2)(ii)(C)(8) (Example 8), the plan does not 

violate the rules of this paragraph (c)(2)(ii). 

The coverage of counseling and behavioral 

therapies and MOUD, in combination, in the 

outpatient, in-network classification and 

prescription drug classification, respectively, 

results in the plan providing meaningful 

benefits for the treatment of opioid use 

disorder in the outpatient, in-network and 

prescription drug classifications. 

(3) * * * 

(i) * * * 

(A) Substantially all. For purposes of 

this paragraph (c)(3), a type of financial 

requirement or quantitative treatment 

limitation is considered to apply to 

substantially all medical/surgical 

benefits in a classification of benefits if 

it applies to at least two-thirds of all 

medical/surgical benefits in that 

classification. (For purposes of this 

paragraph (c)(3)(i)(A), benefits 

expressed as subject to a zero level of a 

type of financial requirement are treated 

as benefits not subject to that type of 

financial requirement, and benefits 

expressed as subject to a quantitative 

treatment limitation that is unlimited 

are treated as benefits not subject to that 

type of quantitative treatment 

limitation.) If a type of financial 

requirement or quantitative treatment 

limitation does not apply to at least twothirds of all medical/surgical benefits in 

a classification, then that type cannot be 

applied to mental health or substance 

use disorder benefits in that 

classification. 

* * * * * 

(C) Portion based on plan payments. 

For purposes of this paragraph (c)(3), 

the determination of the portion of 

medical/surgical benefits in a 

classification of benefits subject to a 

financial requirement or quantitative 

treatment limitation (or subject to any 

level of a financial requirement or 

quantitative treatment limitation) is 

based on the dollar amount of all plan 

payments for medical/surgical benefits 

in the classification expected to be paid 

under the plan for the plan year (or for 


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the portion of the plan year after a 

change in plan benefits that affects the 

applicability of the financial 

requirement or quantitative treatment 

limitation). 

(D) Clarifications for certain threshold 

requirements. For any deductible, the 

dollar amount of plan payments 

includes all plan payments with respect 

to claims that would be subject to the 

deductible if it had not been satisfied. 

For any out-of-pocket maximum, the 

dollar amount of plan payments 

includes all plan payments associated 

with out-of-pocket payments that are 

taken into account towards the out-ofpocket maximum as well as all plan 

payments associated with out-of-pocket 

payments that would have been made 

towards the out-of-pocket maximum if it 

had not been satisfied. The rules of this 

paragraph (c)(3)(i)(D) apply for any 

other thresholds at which the rate of 

plan payment changes. (See also PHS 

Act section 2707 and Affordable Care 

Act section 1302(c), which establish 

annual limitations on out-of-pocket 

maximums for all non-grandfathered 

health plans.) 

* * * * * 

(iii) Special rules. Unless specifically 

permitted under this paragraph 

(c)(3)(iii), sub-classifications are not 

permitted when applying the rules of 

paragraph (c)(3) of this section. 

(A) Multi-tiered prescription drug 

benefits. If a plan (or health insurance 

coverage) applies different levels of 

financial requirements to different tiers 

of prescription drug benefits based on 

reasonable factors determined in 

accordance with the rules in paragraph 

(c)(4) of this section (relating to 

requirements for nonquantitative 

treatment limitations) and without 

regard to whether a drug is generally 

prescribed with respect to medical/ 

surgical benefits or with respect to 

mental health or substance use disorder 

benefits, the plan (or health insurance 

coverage) satisfies the parity 

requirements of this paragraph (c) with 

respect to prescription drug benefits. 

Reasonable factors include cost, 

efficacy, generic versus brand name, and 

mail order versus pharmacy pick-up. 

(B) Multiple network tiers. If a plan (or 

health insurance coverage) provides 

benefits through multiple tiers of innetwork providers (such as an innetwork tier of preferred providers with 

more generous cost-sharing to 

participants than a separate in-network 

tier of participating providers), the plan 

may divide its benefits furnished on an 

in-network basis into sub-classifications 

that reflect network tiers, if the tiering 

is based on reasonable factors 

determined in accordance with the rules 

in paragraph (c)(4) of this section (such 

as quality, performance, and market 

standards) and without regard to 

whether a provider provides services 

with respect to medical/surgical benefits 

or mental health or substance use 

disorder benefits. After the subclassifications are established, the plan 

or issuer may not impose any financial 

requirement or treatment limitation on 

mental health or substance use disorder 

benefits in any sub-classification that is 

more restrictive than the predominant 

financial requirement or treatment 

limitation that applies to substantially 

all medical/surgical benefits in the subclassification using the methodology set 

forth in paragraph (c)(3)(i) of this 

section. 

* * * * * 

(iv) Examples. The rules of 

paragraphs (c)(3)(i) through (iii) of this 

section are illustrated by the following 

examples. In each example, the group 

health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. 

(A) Example 1—(1) Facts. (i) For inpatient, 

out-of-network medical/surgical benefits, a 

group health plan imposes five levels of 

coinsurance. Using a reasonable method, the 

plan projects its payments for the upcoming 

year as follows: 

TABLE 1 TO PARAGRAPH (c)(3)(iv)(A)(1)(i) 

Coinsurance rate .............................. 0% .......... 10% .............................. 15% .............................. 20% .............................. 30% .............................. Total. 

Projected payments .......................... $200x ..... $100x ........................... $450x ........................... $100x ........................... $150x ........................... $1,000x. 

Percent of total plan costs ............... 20% ........ 10% .............................. 45% .............................. 10% .............................. 15%.

Percent subject to coinsurance level N/A ......... 12.5% (100x/800x) ...... 56.25% (450x/800x) .... 12.5% (100x/800x) ...... 18.75% (150x/800x).

(ii) The plan projects plan costs of $800x 

to be subject to coinsurance ($100x + $450x 

+ $100x + $150x = $800x). Thus, 80 percent 

($800x/$1,000x) of the benefits are projected 

to be subject to coinsurance, and 56.25 

percent of the benefits subject to coinsurance 

are projected to be subject to the 15 percent 

coinsurance level. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(A) (Example 1), the two-thirds 

threshold of the substantially all standard is 

met for coinsurance because 80 percent of all 

inpatient, out-of-network medical/surgical 

benefits are subject to coinsurance. Moreover, 

the 15 percent coinsurance is the 

predominant level because it is applicable to 

more than one-half of inpatient, out-ofnetwork medical/surgical benefits subject to 

the coinsurance requirement. The plan may 

not impose any level of coinsurance with 

respect to inpatient, out-of-network mental 

health or substance use disorder benefits that 

is more restrictive than the 15 percent level 

of coinsurance. 

(B) Example 2—(1) Facts. (i) For 

outpatient, in-network medical/surgical 

benefits, a plan imposes five different 

copayment levels. Using a reasonable 

method, the plan projects payments for the 

upcoming year as follows: 

TABLE 2 TO PARAGRAPH (c)(3)(iv)(B)(1)(i) 

Copayment amount .......................... $0 ........... $10 ............................... $15 ............................... $20 ............................... $50 ............................... Total. 

Projected payments .......................... $200x ..... $200x ........................... $200x ........................... $300x ........................... $100x ........................... $1,000x. 

Percent of total plan costs ............... 20% ........ 20% .............................. 20% .............................. 30% .............................. 10%.

Percent subject to copayments ........ N/A ......... 25% (200x/800x) ......... 25% (200x/800x) ......... 37.5% (300x/800x) ...... 12.5% (100x/800x).

(ii) The plan projects plan costs of $800x 

to be subject to copayments ($200x + $200x 

+ $300x + $100x = $800x). Thus, 80 percent 

($800x/$1,000x) of the benefits are projected 

to be subject to a copayment. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(B) (Example 2), the two-thirds 

threshold of the substantially all standard is 

met for copayments because 80 percent of all 

outpatient, in-network medical/surgical 

benefits are subject to a copayment. 

Moreover, there is no single level that applies 

to more than one-half of medical/surgical 

benefits in the classification subject to a 

copayment (for the $10 copayment, 25%; for 

the $15 copayment, 25%; for the $20 

copayment, 37.5%; and for the $50 

copayment, 12.5%). The plan can combine 

any levels of copayment, including the 

highest levels, to determine the predominant 

level that can be applied to mental health or 

substance use disorder benefits. If the plan 

combines the highest levels of copayment, 

the combined projected payments for the two 

highest copayment levels, the $50 copayment 

and the $20 copayment, are not more than 

one-half of the outpatient, in-network 


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medical/surgical benefits subject to a 

copayment because they are exactly one-half 

($300x + $100x = $400x; $400x/$800x = 

50%). The combined projected payments for 

the three highest copayment levels—the $50 

copayment, the $20 copayment, and the $15 

copayment—are more than one-half of the 

outpatient, in-network medical/surgical 

benefits subject to the copayments ($100x + 

$300x + $200x = $600x; $600x/$800x = 

75%). Thus, the plan may not impose any 

copayment on outpatient, in-network mental 

health or substance use disorder benefits that 

is more restrictive than the least restrictive 

copayment in the combination, the $15 

copayment. 

(C) Example 3—(1) Facts. A plan imposes 

a $250 deductible on all medical/surgical 

benefits for self-only coverage and a $500 

deductible on all medical/surgical benefits 

for family coverage. The plan has no network 

of providers. For all medical/surgical 

benefits, the plan imposes a coinsurance 

requirement. The plan imposes no other 

financial requirements or treatment 

limitations. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(C) (Example 3), because the plan 

has no network of providers, all benefits are 

provided out-of-network. Because self-only 

and family coverage are subject to different 

deductibles, whether the deductible applies 

to substantially all medical/surgical benefits 

is determined separately for self-only 

medical/surgical benefits and family 

medical/surgical benefits. Because the 

coinsurance is applied without regard to 

coverage units, the predominant coinsurance 

that applies to substantially all medical/ 

surgical benefits is determined without 

regard to coverage units. 

(D) Example 4—(1) Facts. A plan applies 

the following financial requirements for 

prescription drug benefits. The requirements 

are applied without regard to whether a drug 

is generally prescribed with respect to 

medical/surgical benefits or with respect to 

mental health or substance use disorder 

benefits. Moreover, the process for certifying 

a particular drug as ‘‘generic’’, ‘‘preferred 

brand name’’, ‘‘non-preferred brand name’’, 

or ‘‘specialty’’ complies with the rules of 

paragraph (c)(4) of this section (relating to 

requirements for nonquantitative treatment 

limitations). 

TABLE 3 TO PARAGRAPH (c)(3)(iv)(D)(1) 

Tier 1 Tier 2 Tier 3 Tier 4 

Tier description .............. Generic drugs .......... Preferred brand name drugs .. Non-preferred brand name drugs (which may have Tier 1 or 

Tier 2 alternatives).

Specialty drugs. 

Percent paid by plan ...... 90% .......................... 80% ........................................ 60% ......................................................................................... 50%. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(D) (Example 4), the financial 

requirements that apply to prescription drug 

benefits are applied without regard to 

whether a drug is generally prescribed with 

respect to medical/surgical benefits or with 

respect to mental health or substance use 

disorder benefits; the process for certifying 

drugs in different tiers complies with 

paragraph (c)(4) of this section; and the bases 

for establishing different levels or types of 

financial requirements are reasonable. The 

financial requirements applied to 

prescription drug benefits do not violate the 

parity requirements of this paragraph (c)(3). 

(E) Example 5—(1) Facts. A plan has two 

tiers of network of providers: a preferred 

provider tier and a participating provider 

tier. Providers are placed in either the 

preferred tier or participating tier based on 

reasonable factors determined in accordance 

with the rules in paragraph (c)(4) of this 

section, such as accreditation, quality and 

performance measures (including customer 

feedback), and relative reimbursement rates. 

Furthermore, provider tier placement is 

determined without regard to whether a 

provider specializes in the treatment of 

mental health conditions or substance use 

disorders, or medical/surgical conditions. 

The plan divides the in-network 

classifications into two sub-classifications 

(in-network/preferred and in-network/ 

participating). The plan does not impose any 

financial requirement or treatment limitation 

on mental health or substance use disorder 

benefits in either of these sub-classifications 

that is more restrictive than the predominant 

financial requirement or treatment limitation 

that applies to substantially all medical/ 

surgical benefits in each sub-classification. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(E) (Example 5), the division of innetwork benefits into sub-classifications that 

reflect the preferred and participating 

provider tiers does not violate the parity 

requirements of this paragraph (c)(3). 

(F) Example 6—(1) Facts. With respect to 

outpatient, in-network benefits, a plan 

imposes a $25 copayment for office visits and 

a 20 percent coinsurance requirement for 

outpatient surgery. The plan divides the 

outpatient, in-network classification into two 

sub-classifications (in-network office visits 

and all other outpatient, in-network items 

and services).The plan or issuer does not 

impose any financial requirement or 

quantitative treatment limitation on mental 

health or substance use disorder benefits in 

either of these sub-classifications that is more 

restrictive than the predominant financial 

requirement or quantitative treatment 

limitation that applies to substantially all 

medical/surgical benefits in each subclassification. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(F) (Example 6), the division of 

outpatient, in-network benefits into subclassifications for office visits and all other 

outpatient, in-network items and services 

does not violate the parity requirements of 

this paragraph (c)(3). 

(G) Example 7—(1) Facts. Same facts as in 

paragraph (c)(3)(iv)(F)(1) of this section 

(Example 6), but for purposes of determining 

parity, the plan divides the outpatient, innetwork classification into outpatient, innetwork generalists and outpatient, innetwork specialists. 

(2) Conclusion. In this paragraph 

(c)(3)(iv)(G) (Example 7), the division of 

outpatient, in-network benefits into any subclassifications other than office visits and all 

other outpatient items and services violates 

the requirements of paragraph (c)(3)(iii)(C) of 

this section. 

* * * * * 

(4) Nonquantitative treatment 

limitations. Consistent with paragraph 

(a)(1) of this section, a group health plan 

(or health insurance coverage offered by 

an issuer in connection with a group 

health plan) may not impose any 

nonquantitative treatment limitation 

with respect to mental health or 

substance use disorder benefits in any 

classification that is more restrictive, as 

written or in operation, than the 

predominant nonquantitative treatment 

limitation that applies to substantially 

all medical/surgical benefits in the same 

classification. For purposes of this 

paragraph (c)(4), a nonquantitative 

treatment limitation is more restrictive 

than the predominant nonquantitative 

treatment limitation that applies to 

substantially all medical/surgical 

benefits in the same classification if the 

plan or issuer fails to meet the 

requirements of paragraph (c)(4)(i) or 

(iii) of this section. In such a case, the 

plan (or health insurance coverage) will 

be considered to violate PHS Act section 

2726 (a)(3)(A)(ii), and the 

nonquantitative treatment limitation 

may not be imposed by the plan (or 

health insurance coverage) with respect 

to mental health or substance use 

disorder benefits in the classification. 

(i) Requirements related to design and 

application of a nonquantitative 

treatment limitation—(A) In general. A 

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 

designing and 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, 


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strategies, evidentiary standards, or 

other factors used in designing and 

applying the limitation with respect to 

medical/surgical benefits in the 

classification. 

(B) Prohibition on discriminatory 

factors and evidentiary standards. For 

purposes of determining comparability 

and stringency under paragraph 

(c)(4)(i)(A) of this section, a plan (or 

health insurance coverage) may not rely 

upon discriminatory factors or 

evidentiary standards to design a 

nonquantitative treatment limitation to 

be imposed on mental health or 

substance use disorder benefits. A factor 

or evidentiary standard is 

discriminatory if the information, 

evidence, sources, or standards on 

which the factor or evidentiary standard 

are based are biased or not objective in 

a manner that discriminates against 

mental health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

(1) Information, evidence, sources, or 

standards are considered to be biased or 

not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits 

if, based on all the relevant facts and 

circumstances, the information, 

evidence, sources, or standards 

systematically disfavor access or are 

specifically designed to disfavor access 

to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. For purposes 

of this paragraph (c)(4)(i)(B)(1), relevant 

facts and circumstances may include, 

but are not limited to, the reliability of 

the source of the information, evidence, 

sources, or standards, including any 

underlying data; the independence of 

the information, evidence, sources, and 

standards relied upon; the analyses and 

methodologies employed to select the 

information and the consistency of their 

application; and any known safeguards 

deployed to prevent reliance on skewed 

data or metrics. Information, evidence, 

sources, or standards are not considered 

biased or not objective for this purpose 

if the plan or issuer has taken the steps 

necessary to correct, cure, or 

supplement any information, evidence, 

sources, or standards that would have 

been biased or not objective in the 

absence of such steps. 

(2) For purposes of this paragraph 

(c)(4)(i)(B), historical plan data or other 

historical information from a time when 

the plan or coverage was not subject to 

PHS Act section 2726 or was not in 

compliance with PHS Act section 2726 

are considered to be biased or not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, if the 

historical plan data or other historical 

information systematically disfavor 

access or are specifically designed to 

disfavor access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

and the plan or issuer has not taken the 

steps necessary to correct, cure, or 

supplement the data or information. 

(3) For purposes of this paragraph 

(c)(4)(i)(B), generally recognized 

independent professional medical or 

clinical standards and carefully 

circumscribed measures reasonably and 

appropriately designed to detect or 

prevent and prove fraud and abuse that 

minimize the negative impact on access 

to appropriate mental health and 

substance use disorder benefits are not 

information, evidence, sources, or 

standards that are biased or not 

objective in a manner that discriminates 

against mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. However, 

plans and issuers must comply with the 

other requirements in this paragraph 

(c)(4), as applicable, with respect to 

such standards or measures that are 

used as the basis for a factor or 

evidentiary standard used to design or 

apply a nonquantitative treatment 

limitation. 

(ii) Illustrative, non-exhaustive list of 

nonquantitative treatment limitations. 

Nonquantitative treatment limitations 

include— 

(A) Medical management standards 

(such as prior authorization) limiting or 

excluding benefits based on medical 

necessity or medical appropriateness, or 

based on whether the treatment is 

experimental or investigative; 

(B) Formulary design for prescription 

drugs; 

(C) For plans with multiple network 

tiers (such as preferred providers and 

participating providers), network tier 

design; 

(D) Standards related to network 

composition, including but not limited 

to, standards for provider and facility 

admission to participate in a network or 

for continued network participation, 

including methods for determining 

reimbursement rates, credentialing 

standards, and procedures for ensuring 

the network includes an adequate 

number of each category of provider and 

facility to provide services under the 

plan or coverage; 

(E) Plan or issuer methods for 

determining out-of-network rates, such 

as allowed amounts; usual, customary, 

and reasonable charges; or application 

of other external benchmarks for out-ofnetwork rates; 

(F) Refusal to pay for higher-cost 

therapies until it can be shown that a 

lower-cost therapy is not effective (also 

known as fail-first policies or step 

therapy protocols); 

(G) Exclusions based on failure to 

complete a course of treatment; and 

(H) Restrictions based on geographic 

location, facility type, provider 

specialty, and other criteria that limit 

the scope or duration of benefits for 

services provided under the plan or 

coverage. 

(iii) Required use of outcomes data— 

(A) In general. To ensure that a 

nonquantitative treatment limitation 

applicable to mental health or substance 

use disorder benefits in a classification, 

in operation, is no more restrictive than 

the predominant nonquantitative 

treatment limitation applied to 

substantially all medical/surgical 

benefits in the classification, a plan or 

issuer must collect and evaluate 

relevant data in a manner reasonably 

designed to assess the impact of the 

nonquantitative treatment limitation on 

relevant outcomes related to access to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits and carefully consider the 

impact as part of the plan’s or issuer’s 

evaluation. As part of its evaluation, the 

plan or issuer may not disregard 

relevant outcomes data that it knows or 

reasonably should know suggest that a 

nonquantitative treatment limitation is 

associated with material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits. The 

Secretary, jointly with the Secretary of 

the Treasury and the Secretary of Labor, 

may specify in guidance the type, form, 

and manner of collection and evaluation 

for the data required under this 

paragraph (c)(4)(iii)(A). 

(1) Relevant data generally. For 

purposes of this paragraph (c)(4)(iii)(A), 

relevant data could include, as 

appropriate, but are not limited to, the 

number and percentage of claims 

denials and any other data relevant to 

the nonquantitative treatment limitation 

required by State law or private 

accreditation standards. 

(2) Relevant data for nonquantitative 

treatment limitations related to network 

composition. In addition to the relevant 

data set forth in paragraph 

(c)(4)(iii)(A)(1) of this section, relevant 

data for nonquantitative treatment 

limitations related to network 

composition could include, as 

appropriate, but are not limited to, innetwork and out-of-network utilization 

rates (including data related to provider 

claim submissions), network adequacy 

metrics (including time and distance 


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data, and data on providers accepting 

new patients), and provider 

reimbursement rates (for comparable 

services and as benchmarked to a 

reference standard). 

(3) Unavailability of data. (i) If a plan 

or issuer newly imposes a 

nonquantitative treatment limitation for 

which relevant data is initially 

temporarily unavailable and the plan or 

issuer therefore cannot comply with this 

paragraph (c)(4)(iii)(A), the plan or 

issuer must include in its comparative 

analysis, as required under 

§ 146.137(c)(5)(i)(C), a detailed 

explanation of the lack of relevant data, 

the basis for the plan’s or issuer’s 

conclusion that there is a lack of 

relevant data, and when and how the 

data will become available and be 

collected and analyzed. Such a plan or 

issuer also must comply with this 

paragraph (c)(4)(iii)(A) as soon as 

practicable once relevant data becomes 

available. 

(ii) If a plan or issuer imposes a 

nonquantitative treatment limitation for 

which no data exist that can reasonably 

assess any relevant impact of the 

nonquantitative treatment limitation on 

relevant outcomes related to access to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits, the plan or issuer must include 

in its comparative analysis, as required 

under § 146.137(c)(5)(i)(D), a reasoned 

justification as to the basis for the 

conclusion that there are no data that 

can reasonably assess the 

nonquantitative treatment limitation’s 

impact, why the nature of the 

nonquantitative treatment limitation 

prevents the plan or issuer from 

reasonably measuring its impact, an 

explanation of what data was 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

the nonquantitative treatment limitation 

complies with this section. If a plan or 

issuer becomes aware of data that can 

reasonably assess any relevant impact of 

the nonquantitative treatment 

limitation, the plan or issuer must 

comply with this paragraph (c)(4)(iii)(A) 

as soon as practicable. 

(iii) Consistent with paragraph (a)(1) 

of this section, paragraphs 

(c)(4)(iii)(A)(3)(i) and (ii) of this section 

shall only apply in very limited 

circumstances and, where applicable, 

shall be construed narrowly. 

(B) Material differences. To the extent 

the relevant data evaluated under 

paragraph (c)(4)(iii)(A) of this section 

suggest that the nonquantitative 

treatment limitation contributes to 

material differences in access to mental 

health and substance use disorder 

benefits as compared to medical/ 

surgical benefits in a classification, such 

differences will be considered a strong 

indicator that the plan or issuer violates 

this paragraph (c)(4). 

(1) Where the relevant data suggest 

that the nonquantitative treatment 

limitation contributes to material 

differences in access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits 

in a classification, the plan or issuer 

must take reasonable action, as 

necessary, to address the material 

differences to ensure compliance, in 

operation, with this paragraph (c)(4) and 

must document the actions that have 

been or are being taken by the plan or 

issuer to address material differences in 

access to mental health or substance use 

disorder benefits, as compared to 

medical/surgical benefits, as required by 

§ 146.137(c)(5)(iv). 

(2) For purposes of this paragraph 

(c)(4)(iii)(B), relevant data are 

considered to suggest that the 

nonquantitative treatment limitation 

contributes to material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits if, based on all 

relevant facts and circumstances, and 

taking into account the considerations 

outlined in this paragraph 

(c)(4)(iii)(B)(2), the difference in the data 

suggests that the nonquantitative 

treatment limitation is likely to have a 

negative impact on access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits. 

(i) Relevant facts and circumstances, 

for purposes of this paragraph 

(c)(4)(iii)(B)(2), may include, but are not 

limited to, the terms of the 

nonquantitative treatment limitation at 

issue, the quality or limitations of the 

data, causal explanations and analyses, 

evidence as to the recurring or nonrecurring nature of the results, and the 

magnitude of any disparities. 

(ii) Differences in access to mental 

health or substance use disorder 

benefits attributable to generally 

recognized independent professional 

medical or clinical standards or 

carefully circumscribed measures 

reasonably and appropriately designed 

to detect or prevent and prove fraud and 

abuse that minimize the negative impact 

on access to appropriate mental health 

and substance use disorder benefits, 

which are used as the basis for a factor 

or evidentiary standard used to design 

or apply a nonquantitative treatment 

limitation, are not considered to be 

material for purposes of this paragraph 

(c)(4)(iii)(B). To the extent a plan or 

issuer attributes any differences in 

access to the application of such 

standards or measures, the plan or 

issuer must explain the bases for that 

conclusion in the documentation 

prepared under § 146.137(c)(5)(iv)(A). 

(C) Nonquantitative treatment 

limitations related to network 

composition. For purposes of applying 

paragraph (c)(4)(iii)(A) of this section 

with respect to nonquantitative 

treatment limitations related to network 

composition, a plan or issuer must 

collect and evaluate relevant data in a 

manner reasonably designed to assess 

the aggregate impact of all such 

nonquantitative treatment limitations on 

access to mental health and substance 

use disorder benefits and medical/ 

surgical benefits. Examples of possible 

actions that a plan or issuer could take 

to comply with the requirement under 

paragraph (c)(4)(iii)(B)(1) of this section 

to take reasonable action, as necessary, 

to address any material differences in 

access with respect to nonquantitative 

treatment limitations related to network 

composition, to ensure compliance with 

this paragraph (c)(4), include, but are 

not limited to: 

(1) Strengthening efforts to recruit and 

encourage a broad range of available 

mental health and substance use 

disorder providers and facilities to join 

the plan’s or issuer’s network of 

providers, including taking actions to 

increase compensation or other 

inducements, streamline credentialing 

processes, or contact providers 

reimbursed for items and services 

provided on an out-of-network basis to 

offer participation in the network; 

(2) Expanding the availability of 

telehealth arrangements to mitigate any 

overall mental health and substance use 

disorder provider shortages in a 

geographic area; 

(3) Providing additional outreach and 

assistance to participants and 

beneficiaries enrolled in the plan or 

coverage to assist them in finding 

available in-network mental health and 

substance use disorder providers and 

facilities; and 

(4) Ensuring that provider directories 

are accurate and reliable. 

(iv) Prohibition on separate 

nonquantitative treatment limitations 

applicable only to mental health or 

substance use disorder benefits. 

Consistent with paragraph (c)(2)(i) of 

this section, a group health plan (or 

health insurance coverage offered by an 

issuer in connection with such a plan) 

may not apply any nonquantitative 

treatment limitation that is applicable 

only with respect to mental health or 

substance use disorder benefits and 

does not apply with respect to any 


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medical/surgical benefits in the same 

benefit classification. 

(v) Effect of final determination of 

noncompliance under § 146.137. (A) If a 

group health plan (or health insurance 

issuer offering coverage in connection 

with a group health plan) receives a 

final determination from the Secretary 

or applicable State authority that the 

plan or issuer is not in compliance with 

the requirements of PHS Act section 

2726(a)(8) or § 146.137 with respect to a 

nonquantitative treatment limitation, 

the nonquantitative treatment limitation 

violates this paragraph (c)(4) and the 

Secretary or applicable State authority 

may direct the plan or issuer not to 

impose the nonquantitative treatment 

limitation with respect to mental health 

or substance use disorder benefits in the 

relevant classification, unless and until 

the plan or issuer demonstrates to the 

Secretary or applicable State authority 

compliance with the requirements of 

this section or takes appropriate action 

to remedy the violation. 

(B) A determination by the Secretary 

of whether to require cessation of a 

nonquantitative treatment limitation 

under this paragraph (c)(4)(v) will be 

based on an evaluation of the relevant 

facts and circumstances involved in the 

specific final determination and the 

nature of the underlying 

nonquantitative treatment limitation 

and will take into account the interest 

of plan participants and beneficiaries 

and feedback from the plan or issuer. 

(vi) Examples. The rules of this 

paragraph (c)(4) are illustrated by the 

following examples. In each example, 

the group health plan is subject to the 

requirements of this section and 

provides both medical/surgical benefits 

and mental health and substance use 

disorder benefits. 

(A) Example 1 (not comparable and more 

stringent factors for reimbursement rate 

methodology, in operation)—(1) Facts. A 

plan’s reimbursement rate methodology for 

outpatient, in-network providers is based on 

a variety of factors. As written, for mental 

health, substance use disorder, and medical/ 

surgical benefits, all reimbursement rates for 

physicians and non-physician practitioners 

for the same Current Procedural Terminology 

(CPT) code are based on a combination of 

factors, such as the nature of the service, 

duration of the service, intensity and 

specialization of training, provider licensure 

and type, number of providers qualified to 

provide the service in a given geographic 

area, and market need (demand). In 

operation, the plan utilizes an additional 

strategy to further reduce reimbursement 

rates for mental health and substance use 

disorder non-physician providers from those 

paid to mental health and substance use 

disorder physicians by the same percentage 

for every CPT code, but does not apply the 

same reductions for non-physician medical/ 

surgical providers. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(A) (Example 1), the plan violates 

the rules of this paragraph (c)(4). Because the 

plan reimburses non-physician providers of 

mental health and substance use disorder 

services by reducing their reimbursement 

rate from the rate for physician providers of 

mental health and substance use disorder 

services by the same percentage for every 

CPT code but does not apply the same 

reductions to non-physician providers of 

medical/surgical services from the rate for 

physician providers of medical/surgical 

services, in operation, the factors used in 

designing and applying the nonquantitative 

treatment limitation to mental health and 

substance use disorder benefits in the 

outpatient, in-network classification are not 

comparable to, and are applied more 

stringently than, the factors used in designing 

and applying the limitation with respect to 

medical/surgical benefits in the same 

classification. As a result, the 

nonquantitative treatment limitation with 

respect to mental health or substance use 

disorder benefits in the outpatient, innetwork classification is more restrictive than 

the predominant nonquantitative treatment 

limitation that applies to substantially all 

medical/surgical benefits in the same 

classification. 

(B) Example 2 (strategy for exclusion for 

experimental or investigative treatment more 

stringently applied to ABA therapy in 

operation)—(1) Facts. A plan, as written, 

generally excludes coverage for all treatments 

that are experimental or investigative for both 

medical/surgical benefits and mental health 

and substance use disorder benefits in the 

outpatient, in-network classification. As a 

result, the plan generally excludes, as 

experimental, a treatment or procedure when 

no professionally recognized treatment 

guidelines include the treatment or 

procedure as a clinically appropriate 

standard of care for the condition or disorder 

and fewer than two randomized controlled 

trials are available to support the treatment’s 

use with respect to the given condition or 

disorder. The plan provides benefits for the 

treatment of ASD, which is a mental health 

condition, but, in operation, the plan 

excludes coverage for ABA therapy to treat 

children with ASD, deeming it experimental. 

More than one professionally recognized 

treatment guideline defines clinically 

appropriate standards of care for ASD and 

more than two randomized controlled trials 

are available to support the use of ABA 

therapy as one intervention to treat certain 

children with ASD. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(B) (Example 2), the plan violates the 

rules of this paragraph (c)(4). As written, the 

plan excludes coverage of experimental 

treatment of medical conditions and surgical 

procedures, mental health conditions, and 

substance use disorders when no 

professionally recognized treatment 

guidelines define clinically appropriate 

standards of care for the condition or 

disorder as including the treatment or 

procedure at issue, and fewer than two 

randomized controlled trials are available to 

support the treatment’s use with respect to 

the given condition or procedure. However, 

in operation, the plan deviates from this 

strategy with respect to ABA therapy because 

more than one professionally recognized 

treatment guideline defines clinically 

appropriate standards of care for ASD as 

including ABA therapy to treat certain 

children with ASD and more than two 

randomized controlled trials are available to 

support the use of ABA therapy to treat 

certain children with ASD. Therefore, in 

operation, the strategy used to design the 

nonquantitative treatment limitation for 

benefits for the treatment of ASD, which is 

a mental health condition, in the outpatient, 

in-network classification is not comparable 

to, and is applied more stringently than, the 

strategy used to design the nonquantitative 

treatment limitation for medical/surgical 

benefits in the same classification. As a 

result, the nonquantitative treatment 

limitation with respect to mental health or 

substance use disorder benefits in the 

outpatient, in-network classification is more 

restrictive than the predominant 

nonquantitative treatment limitation that 

applies to substantially all medical/surgical 

benefits in the same classification. 

(C) Example 3 (step therapy protocol with 

exception for severe or irreversible 

consequences, discriminatory factor)—(1) 

Facts. A plan’s written terms include a step 

therapy protocol that requires participants 

and beneficiaries who are prescribed certain 

drugs to try and fail a generic or preferred 

brand name drug before the plan will cover 

the drug originally prescribed by a 

participant’s or beneficiary’s attending 

provider. The plan provides an exception to 

this protocol that was developed solely based 

on a methodology developed by an external 

third-party organization. The third-party 

organization’s methodology, which is not 

based on a generally recognized independent 

professional medical or clinical standard, 

identifies instances in which a delay in 

treatment with a drug prescribed for a 

medical condition or surgical procedure 

could result in either severe or irreversible 

consequences. However, with respect to a 

drug prescribed for a mental health condition 

or a substance use disorder, the third-party 

organization’s methodology only identifies 

instances in which a delay in treatment could 

result in both severe and irreversible 

consequences, and the plan does not take any 

steps to correct, cure, or supplement the 

methodology. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(C) (Example 3), the plan violates the 

rules of paragraph (c)(4)(i)(B) of this section. 

The source upon which the factor used to 

apply the step therapy protocol is based is 

biased or not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits because it 

addresses instances in which a delay in 

treatment with a drug prescribed for a 

medical condition or surgical procedure 

could result in either severe or irreversible 

consequences, but only addresses instances 

in which a delay in treatment with a drug 

prescribed for a mental health condition or 

substance use disorder could result in both 


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severe and irreversible consequences, and the 

plan fails to take the steps necessary to 

correct, cure, or supplement the methodology 

so that it is not biased and is objective. Based 

on the relevant facts and circumstances, this 

source systematically disfavors access or is 

specifically designed to disfavor access to 

mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits. Therefore, the factor used to apply 

the step therapy protocol is discriminatory 

for purposes of determining comparability 

and stringency under paragraph (c)(4)(i)(A) of 

this section, and may not be relied upon by 

the plan. 

(D) Example 4 (use of historical plan data 

and plan steps to correct, cure, or 

supplement)—(1) Facts. A plan’s 

methodology for calculating provider 

reimbursement rates relies only on historical 

plan data on total plan spending for each 

specialty, divided between mental health and 

substance use disorder providers and 

medical/surgical providers, from a time when 

the plan was not subject to PHS Act section 

2726. The plan has used these historical plan 

data for many years to establish base 

reimbursement rates in all provider 

specialties for which it provides medical/ 

surgical, mental health, and substance use 

disorder benefits in the inpatient, in-network 

classification. In evaluating the use of these 

historical plan data in the design of the 

methodology for calculating provider 

reimbursement rates, the plan determined, 

based on all the relevant facts and 

circumstances, that the historical plan data 

systematically disfavor access or are 

specifically designed to disfavor access to 

mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits. To ensure this information about 

historical reimbursement rates is not biased 

and is objective, the plan supplements its 

methodology to develop the base 

reimbursement rates for mental health and 

substance use disorder providers in 

accordance with additional information, 

evidence, sources, and standards that reflect 

the increased demand for mental health and 

substance use disorder benefits in the 

inpatient, in-network classification and to 

attract sufficient mental health and substance 

use disorder providers to the network, so that 

the relevant facts and circumstances indicate 

the supplemented information, evidence, 

sources, or standards do not systematically 

disfavor access and are not specifically 

designed to disfavor access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(D) (Example 4), the plan does not 

violate the rules of paragraph (c)(4)(i)(B) of 

this section with respect to the plan’s 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification. The relevant facts and 

circumstances indicate that the plan’s use of 

only historical plan data to design its 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification would otherwise be 

considered to be biased or not objective in a 

manner that discriminates against mental 

health or substance use disorder benefits as 

compared to medical/surgical benefits under 

paragraph (c)(4)(i)(B)(2) of this section, since 

the historical data systematically disfavor 

access or are specifically designed to disfavor 

access to mental health or substance use 

disorder benefits as compared to medical/ 

surgical benefits. However, the plan took the 

steps necessary to supplement the 

information, evidence, sources, and 

standards to reasonably reflect the increased 

demand for mental health and substance use 

disorder benefits in the inpatient, in-network 

classification, and adjust the methodology to 

increase reimbursement rates for those 

benefits, thereby ensuring that the 

information, evidence, sources, and 

standards relied upon by the plan for this 

purpose are not biased and are objective. 

Therefore, the factors and evidentiary 

standards used to design the plan’s 

methodology for calculating provider 

reimbursement rates in the inpatient, innetwork classification are not discriminatory. 

(E) Example 5 (generally recognized 

independent professional medical or clinical 

standards and more stringent prior 

authorization requirement in operation)—(1) 

Facts. The provisions of a plan state that it 

relies on, and does not deviate from, 

generally recognized independent 

professional medical or clinical standards to 

inform the factor used to design prior 

authorization requirements for both medical/ 

surgical and mental health and substance use 

disorder benefits in the prescription drug 

classification. The generally recognized 

independent professional medical standard 

for treatment of opioid use disorder that the 

plan utilizes—in this case, the American 

Society of Addiction Medicine national 

practice guidelines—does not support prior 

authorization every 30 days for 

buprenorphine/naloxone. However, in 

operation, the plan requires prior 

authorization for buprenorphine/naloxone 

combination for treatment of opioid use 

disorder, every 30 days, which is 

inconsistent with the generally recognized 

independent professional medical standard 

on which the factor used to design the 

limitation is based. The plan’s factor used to 

design prior authorization requirements for 

medical/surgical benefits in the prescription 

drug classification relies on, and does not 

deviate from, generally recognized 

independent professional medical or clinical 

standards. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(E) (Example 5), the plan violates the 

rules of this paragraph (c)(4). The American 

Society of Addiction Medicine national 

practice guidelines on which the factor used 

to design prior authorization requirements 

for substance use disorder benefits is based 

are generally recognized independent 

professional medical or clinical standards 

that are not considered to be biased or not 

objective in a manner that discriminates 

against mental health and substance use 

disorder benefits under paragraph 

(c)(4)(i)(B)(3) of this section. However, the 

plan must comply with other requirements in 

this paragraph (c)(4), as applicable, with 

respect to such standards or measures that 

are used as the basis for a factor or 

evidentiary standard used to design or apply 

a nonquantitative treatment limitation. In 

operation, the plan’s factor used to design 

and apply prior authorization requirements 

with respect to substance use disorder 

benefits is not comparable to, and is applied 

more stringently than, the same factor used 

to design and apply prior authorization 

requirements for medical/surgical benefits, 

because the factor relies on, and does not 

deviate from, generally recognized 

independent professional medical or clinical 

standards for medical/surgical benefits, but 

deviates from the relevant guidelines for 

substance use disorder benefits. As a result, 

the nonquantitative treatment limitation with 

respect to substance use disorder benefits in 

the prescription drug classification is more 

restrictive than the predominant 

nonquantitative treatment limitation that 

applies to substantially all medical/surgical 

benefits in the same classification. 

(F) Example 6 (plan claims no data exist 

to reasonably assess impact of 

nonquantitative treatment limitation on 

access; medical necessity criteria)—(1) Facts. 

A plan approves or denies claims for mental 

health and substance use disorder benefits 

and for medical/surgical benefits in the 

inpatient, in-network and outpatient, innetwork classifications based on medical 

necessity criteria. The plan states in its 

comparative analysis that no data exist that 

can reasonably assess any relevant impact of 

the medical necessity criteria nonquantitative 

treatment limitation on relevant outcomes 

related to access to mental health or 

substance use disorder benefits as compared 

to the plan’s medical necessity criteria 

nonquantitative treatment limitation’s impact 

on relevant outcomes related to access to 

medical/surgical benefits in the relevant 

classifications, without further explanation. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(F) (Example 6), the plan violates 

this paragraph (c)(4). The plan does not 

comply with paragraph (c)(4)(iii)(A)(3)(ii) of 

this section because the plan did not include 

in its comparative analysis, as required under 

§ 146.137(c)(5)(i)(D), a reasoned justification 

as to the basis for its conclusion that there 

are no data that can reasonably assess the 

nonquantitative treatment limitation’s 

impact, an explanation of why the nature of 

the nonquantitative treatment limitation 

prevents the plan from reasonably measuring 

its impact, an explanation of what data was 

considered and rejected, and documentation 

of any additional safeguards or protocols 

used to ensure the nonquantitative treatment 

limitation complies with this paragraph 

(c)(4). Data that could reasonably assess the 

medical necessity criteria nonquantitative 

treatment limitation’s impact might include, 

for example, the number and percentage of 

claims denials, or the number and percentage 

of claims that were approved for a lower 

level of care than the level requested on the 

initial claim. Therefore, because the plan has 

not collected and evaluated relevant data in 

a manner reasonably designed to assess the 

impact of the nonquantitative treatment 

limitation on relevant outcomes related to 

access to mental health and substance use 

disorder benefits and medical/surgical 

benefits in the relevant classifications, the 

plan violates the requirements of paragraph 


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(c)(4)(iii) of this section, and violates the 

requirements under § 146.137(c)(5)(i)(D) 

because it did not include sufficient 

information in its comparative analysis with 

respect to the lack of relevant data. 

(G) Example 7 (concurrent review data 

collection; no material difference in access)— 

(1) Facts. A plan follows a written process to 

apply a concurrent review nonquantitative 

treatment limitation to all medical/surgical 

benefits and mental health and substance use 

disorder benefits within the inpatient, innetwork classification. Under this process, a 

first-level review is conducted in every 

instance in which concurrent review applies 

and an authorization request is approved by 

the first-level reviewer only if the clinical 

information submitted by the facility meets 

the plan’s criteria for a continued stay. If the 

first-level reviewer is unable to approve the 

authorization request because the clinical 

information submitted by the facility does 

not meet the plan’s criteria for a continued 

stay, it is sent to a second-level reviewer who 

will either approve or deny the request. The 

plan collects relevant data, including the 

number of referrals to second-level review, 

and the number of denials of claims for 

medical/surgical benefits and mental health 

and substance use disorder benefits subject to 

concurrent review as compared to the total 

number of claims subject to concurrent 

review, in the inpatient, in-network 

classification. The plan also collects and 

evaluates the number of denied claims for 

medical/surgical benefits and mental health 

and substance use disorder benefits that are 

overturned on appeal in the inpatient, innetwork classification. The plan evaluates 

the relevant data and determines that, based 

on the relevant facts and circumstances, the 

data do not suggest that the concurrent 

review nonquantitative treatment limitation 

contributes to material differences in access 

to mental health or substance use disorder 

benefits as compared to medical/surgical 

benefits in the classification. Upon 

requesting the plan’s comparative analysis 

for the concurrent review nonquantitative 

treatment limitation and reviewing the 

relevant data, the Secretary does not request 

additional data and agrees that the data do 

not suggest material differences in access. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(G) (Example 7), the plan does not 

violate the rules of paragraph (c)(4)(iii) of this 

section. The plan collected and evaluated 

relevant data in a manner reasonably 

designed to assess the impact of the 

nonquantitative treatment limitation on 

relevant outcomes related to access to mental 

health and substance use disorder benefits 

and medical/surgical benefits and considered 

the impact as part of its evaluation. Because 

the relevant data evaluated do not suggest 

that the nonquantitative treatment limitation 

contributes to material differences in access 

to mental health and substance use disorder 

benefits as compared to medical/surgical 

benefits in the inpatient, in-network 

classification, under paragraph (c)(4)(iii)(B) 

of this section, there is no strong indicator 

that the plan violates this paragraph (c)(4). 

(H) Example 8 (material difference in 

access for prior authorization requirement 

with reasonable action)—(1) Facts. A plan 

requires prior authorization that a treatment 

is medically necessary for all inpatient, innetwork medical/surgical benefits and for all 

inpatient, in-network mental health and 

substance use disorder benefits. The plan 

collects and evaluates relevant data in a 

manner reasonably designed to assess the 

impact of the prior authorization requirement 

on relevant outcomes related to access to 

mental health and substance use disorder 

benefits and medical/surgical benefits in the 

inpatient, in-network classification. The 

plan’s written process for prior authorization 

states that the plan approves inpatient, innetwork benefits for medical conditions and 

surgical procedures and mental health and 

substance use disorder benefits for periods of 

1, 3, and 7 days, after which a treatment plan 

must be submitted by the patient’s attending 

provider and approved by the plan. 

Approvals for mental health and substance 

use disorder benefits are most commonly 

given only for 1 day, after which a treatment 

plan must be submitted by the patient’s 

attending provider and approved by the plan. 

The relevant data show that approvals for 7 

days are most common for medical 

conditions and surgical procedures under 

this plan. Based on all the relevant facts and 

circumstances, the difference in the relevant 

data suggests that the nonquantitative 

treatment limitation is likely to have a 

negative impact on access to mental health 

and substance use disorder benefits as 

compared to medical/surgical benefits. 

Therefore, the data suggest that the 

nonquantitative treatment limitation 

contributes to material differences in access. 

To address these material differences in 

access, the plan consults more recent medical 

guidelines to update the factors that inform 

its medical necessity nonquantitative 

treatment limitations. Based on this review, 

the plan modifies the limitation so that 

inpatient, in-network prior authorization 

requests for mental health or substance use 

disorder benefits are approved for similar 

periods to what is approved for medical/ 

surgical benefits. The plan includes 

documentation of this action as part of its 

comparative analysis. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(H) (Example 8), the plan does not 

violate the rules of paragraph (c)(4)(iii) of this 

section. While relevant data for the plan’s 

prior authorization requirements suggested 

that the nonquantitative treatment limitation 

contributes to material differences in access 

to mental health and substance use disorder 

benefits as compared to inpatient, in-network 

medical/surgical benefits under paragraph 

(c)(4)(iii)(B) of this section, the plan has 

taken reasonable action, as necessary, to 

ensure compliance, in operation, with this 

paragraph (c)(4) by updating the factors that 

inform its prior authorization 

nonquantitative treatment limitation for 

inpatient, in-network mental health and 

substance use disorder benefits so that these 

benefits are approved for similar periods to 

what is approved for medical/surgical 

benefits. The plan also documents its action 

taken to address material differences in 

access to inpatient, in-network benefits as 

required by paragraph (c)(4)(iii)(B)(1) of this 

section. 

(I) Example 9 (differences attributable to 

generally recognized independent 

professional medical or clinical standards)— 

(1) Facts. A group health plan develops a 

medical management requirement for all 

inpatient, out-of-network benefits for both 

medical/surgical benefits and mental health 

and substance use disorder benefits to ensure 

treatment is medically necessary. The factors 

and evidentiary standards used to design and 

apply the medical management requirement 

rely on independent professional medical or 

clinical standards that are generally 

recognized by health care providers and 

facilities in relevant clinical specialties. The 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the medical management 

requirement to mental health and substance 

use disorder benefits are comparable to, and 

are applied no more stringently than, the 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the requirement with respect to 

medical/surgical benefits. The plan collects 

and evaluates relevant data in a manner 

reasonably designed to assess the impact of 

the medical management nonquantitative 

treatment limitation on relevant outcomes 

related to access to mental health and 

substance use disorder benefits and medical/ 

surgical benefits, and considers the impact as 

part of the plan’s evaluation, as required by 

paragraph (c)(4)(iii)(A) of this section. Within 

the inpatient, out-of-network classification, 

the application of the medical management 

requirement results in a higher percentage of 

denials for mental health and substance use 

disorder claims than medical/surgical claims, 

because the benefits were found to be 

medically necessary for a lower percentage of 

mental health and substance use disorder 

claims. The plan correctly determines that 

these differences in access are attributable to 

the generally recognized independent 

professional medical or clinical standards 

used as the basis for the factors and 

evidentiary standards used to design or apply 

the limitation and adequately explains the 

bases for that conclusion as part of its 

comparative analysis. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(I) (Example 9), the plan does not 

violate the rules of this paragraph (c)(4). 

Generally recognized independent 

professional medical or clinical standards of 

care are not considered to be information, 

evidence, sources, or standards that are 

biased and not objective in a manner that 

discriminates against mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits, and the plan 

otherwise complies with the requirements in 

paragraph (c)(4)(i) of this section. 

Additionally, the plan does not violate 

paragraph (c)(4)(iii) of this section because it 

has collected and evaluated relevant data, the 

differences in access are attributable to the 

generally recognized independent 

professional medical or clinical standards 

that are used as the basis for the factors and 

evidentiary standards used to design or apply 

the medical management nonquantitative 

treatment limitation, and the plan explains 

the bases for this conclusion in its 

comparative analysis. As a result, the 


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nonquantitative treatment limitation with 

respect to mental health or substance use 

disorder benefits in the inpatient, out-ofnetwork classification is no more restrictive 

than the predominant nonquantitative 

treatment limitation that applies to 

substantially all medical/surgical benefits in 

the same classification. 

(J) Example 10 (material differences in 

access for standards for provider admission 

to a network with reasonable action)—(1) 

Facts. A plan applies nonquantitative 

treatment limitations related to network 

composition in the inpatient, in-network and 

outpatient, in-network classifications. The 

plan’s networks are constructed by separate 

service providers for medical/surgical 

benefits and mental health and substance use 

disorder benefits. The processes, strategies, 

evidentiary standards, and other factors used 

in designing and applying the 

nonquantitative treatment limitations related 

to network composition for mental health or 

substance use disorder benefits in the 

outpatient, in-network and inpatient, innetwork classifications are comparable to, 

and are applied no more stringently than, the 

processes, strategies, evidentiary standards, 

and other factors used in designing and 

applying the nonquantitative treatment 

limitations with respect to medical/surgical 

benefits in the classifications, as required 

under paragraph (c)(4)(i) of this section. In 

order to ensure, in operation, that the 

nonquantitative treatment limitations are no 

more restrictive than the predominant 

nonquantitative treatment limitations applied 

to substantially all medical/surgical benefits 

in the classification, the plan collects and 

evaluates relevant data in a manner 

reasonably designed to assess the aggregate 

impact of all the nonquantitative treatment 

limitations related to network composition 

on relevant outcomes related to access to 

mental health and substance use disorder 

benefits as compared with access to medical/ 

surgical benefits and considers the impact as 

part of the plan’s evaluation. The plan 

considers relevant data that is known, or 

reasonably should be known, including 

metrics relating to the time and distance from 

plan participants and beneficiaries to 

network providers in rural and urban regions; 

the number of network providers accepting 

new patients; the proportions of mental 

health and substance use disorder and 

medical/surgical providers and facilities that 

provide services in rural and urban regions 

who are in the plan’s network; provider 

reimbursement rates (for comparable services 

and benchmarked to a reference standard, as 

appropriate); and in-network and out-ofnetwork utilization rates (including data 

related to the dollar value and number of 

provider claims submissions). The plan 

determines that the relevant data suggest that 

the nonquantitative treatment limitations in 

the aggregate contribute to material 

differences in access to mental health and 

substance use disorder benefits compared to 

medical/surgical benefits in the 

classifications because, based on all the 

relevant facts and circumstances, the 

differences in the data suggest that the 

nonquantitative treatment limitations related 

to network composition are likely to have a 

negative impact on access to mental health or 

substance use disorder benefits as compared 

to medical/surgical benefits. The plan takes 

reasonable actions, as necessary, to address 

the material differences in access, to ensure 

compliance, in operation, with this 

paragraph (c)(4), by strengthening its efforts 

to recruit and encourage a broad range of 

available providers and facilities to join the 

plan’s network of providers, including by 

taking actions to increase compensation and 

other inducements, streamline credentialing 

processes, contact providers reimbursed for 

items and services provided on an out-ofnetwork basis to offer participation in the 

network, and develop a process to monitor 

the effects of such efforts; expanding the 

availability of telehealth arrangements to 

mitigate overall provider shortages in certain 

geographic areas; providing additional 

outreach and assistance to participants and 

beneficiaries enrolled in the plan to assist 

them in finding available in-network 

providers and facilities; and ensuring that the 

plan’s provider directories are accurate and 

reliable. The plan documents the efforts that 

it has taken to address the material 

differences in access that the data revealed, 

and the plan includes the documentation as 

part of its comparative analysis submission. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(J) (Example 10), the plan does not 

violate the rules of this paragraph (c)(4). The 

plan’s nonquantitative treatment limitations 

related to network composition comply with 

the rules of paragraph (c)(4)(i) of this section. 

Additionally, the plan collects and evaluates 

relevant data, as required under paragraph 

(c)(4)(iii)(A) of this section, in a manner 

reasonably designed to assess the aggregate 

impact of all such nonquantitative treatment 

limitations on relevant outcomes related to 

access to mental health and substance use 

disorder benefits and medical/surgical 

benefits, as required under paragraph 

(c)(4)(iii)(C) of this section. While the data 

suggest that the nonquantitative treatment 

limitations contribute to material differences 

in access to mental health and substance use 

disorder benefits as compared to medical/ 

surgical benefits, the plan has taken 

reasonable action, as necessary, to ensure 

compliance with this paragraph (c)(4). The 

plan also documents the actions that have 

been and are being taken by the plan to 

address material differences as required by 

§ 146.137(c)(5)(iv). As a result, the network 

composition nonquantitative treatment 

limitations with respect to mental health or 

substance use disorder benefits in the 

inpatient, in-network and outpatient, innetwork classifications are no more 

restrictive than the predominant 

nonquantitative treatment limitations that 

apply to substantially all medical/surgical 

benefits in the same classifications. 

(K) Example 11 (separate EAP exhaustion 

treatment limitation applicable only to 

mental health or substance use disorder 

benefits)—(1) Facts. An employer maintains 

both a major medical plan and an employee 

assistance program (EAP). The EAP provides, 

among other benefits, a limited number of 

mental health or substance use disorder 

counseling sessions, which, together with 

other benefits provided by the EAP, are not 

significant benefits in the nature of medical 

care. Participants are eligible for mental 

health or substance use disorder benefits 

under the major medical plan only after 

exhausting the counseling sessions provided 

by the EAP. No similar exhaustion 

requirement applies with respect to medical/ 

surgical benefits provided under the major 

medical plan. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(K) (Example 11), the requirement 

that limits eligibility for mental health and 

substance use disorder benefits under the 

major medical plan until EAP benefits are 

exhausted is a nonquantitative treatment 

limitation subject to the parity requirements 

of this paragraph (c)(4). Because the 

limitation does not apply to medical/surgical 

benefits, it is a separate nonquantitative 

treatment limitation applicable only to 

mental health and substance use disorder 

benefits that violates paragraph (c)(4)(iv) of 

this section. Additionally, this EAP would 

not qualify as excepted benefits under 

§ 146.145(b)(3)(vi)(B)(1) because participants 

in the major medical plan are required to use 

and exhaust benefits under the EAP (making 

the EAP a gatekeeper) before an individual is 

eligible for benefits under the plan. 

(L) Example 12 (separate exclusion for 

treatment in a residential facility applicable 

only to mental health and substance use 

disorder benefits)—(1) Facts. A plan 

generally covers inpatient, in-network and 

inpatient, out-of-network treatment without 

any limitations on setting, including skilled 

nursing facilities and rehabilitation hospitals, 

provided other medical necessity standards 

are satisfied. The plan has an exclusion for 

treatment at residential facilities, which the 

plan defines as an inpatient benefit for 

mental health and substance use disorder 

benefits. This exclusion was not generated 

through any broader nonquantitative 

treatment limitation (such as medical 

necessity or other clinical guideline). 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(L) (Example 12), the plan violates 

the rules of paragraph (c)(4)(iv) of this 

section. The exclusion of treatment at 

residential facilities is a separate 

nonquantitative treatment limitation 

applicable only to mental health and 

substance use disorder benefits in the 

inpatient, in-network and inpatient, out-ofnetwork classifications because the plan does 

not apply a comparable exclusion with 

respect to any medical/surgical benefits in 

the same benefit classification. 

(M) Example 13 (impermissible 

nonquantitative treatment limitation 

imposed following a final determination of 

noncompliance and direction by the 

Secretary)—(1) Facts. Following an initial 

request by the Secretary for a plan’s 

comparative analysis of the plan’s exclusion 

of mental health and substance use disorder 

benefits for failure to complete a course of 

treatment in the inpatient, in-network 

classification under § 146.137(d), the plan 

submits a comparative analysis for the 

nonquantitative treatment limitation. After 

review of the comparative analysis, as well 

as additional information submitted by the 

plan after the Secretary determines that the 

plan has not submitted sufficient information 


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to be responsive to the request, the Secretary 

makes an initial determination that the 

comparative analysis fails to demonstrate 

that the processes, strategies, evidentiary 

standards, and other factors used in 

designing and applying the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits in the 

inpatient, in-network classification are 

comparable to, and applied no more 

stringently than, those used in designing and 

applying the limitation to medical/surgical 

benefits in the classification. Under 

§ 146.137(d)(3), the plan submits a corrective 

action plan and additional comparative 

analyses within 45 calendar days after the 

initial determination. However, the 

corrective action plan does not alter or 

eliminate the exclusion or alter the processes, 

strategies, evidentiary standards, and other 

factors used in designing and applying the 

exclusion. Moreover, the additional 

comparative analysis still does not include 

sufficient information. The Secretary then 

determines that the additional comparative 

analyses do not demonstrate compliance 

with the requirements of this paragraph 

(c)(4). Accordingly, the plan receives a final 

determination of noncompliance with PHS 

Act section 2726 (a)(8) and § 146.137 from 

the Secretary, which concludes that the plan 

did not demonstrate compliance through the 

comparative analysis process. After 

considering the relevant facts and 

circumstances, and considering the interests 

of plan participants and beneficiaries, as well 

as feedback from the plan, the Secretary 

directs the plan not to impose the 

nonquantitative treatment limitation by a 

certain date, unless and until the plan 

demonstrates compliance to the Secretary or 

takes appropriate action to remedy the 

violation. The plan makes no changes to its 

plan terms by that date and continues to 

impose the exclusion of benefits for failure to 

complete a course of treatment in the 

inpatient, in-network classification. 

(2) Conclusion. In this paragraph 

(c)(4)(vi)(M) (Example 13), by continuing to 

impose the exclusion of mental health and 

substance use disorder benefits for failure to 

complete a course of treatment in the 

inpatient, in-network classification after the 

Secretary directs the plan not to impose this 

nonquantitative treatment limitation, the 

plan violates the requirements of paragraph 

(c)(4)(v) of this section. 

* * * * * 

(d) * * * 

(3) Provisions of other law. 

Compliance with the disclosure 

requirements in paragraphs (d)(1) and 

(2) of this section is not determinative 

of compliance with any other provision 

of applicable Federal or State law. In 

particular, in addition to those 

disclosure requirements, provisions of 

other applicable law require disclosure 

of information relevant to medical/ 

surgical, mental health, and substance 

use disorder benefits. For example, 

§ 147.136 of this subchapter sets forth 

rules regarding claims and appeals, 

including the right of claimants (or their 

authorized representative) who have 

received an adverse benefit 

determination (or a final internal 

adverse benefit determination) to be 

provided, upon request and free of 

charge, reasonable access to and copies 

of all documents, records, and other 

information relevant to the claimant’s 

claim for benefits. This includes 

documents 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 and the comparative analyses 

and other applicable information 

required by § 146.137. 

(e) * * * 

(4) Coordination with EHB 

requirements. Nothing in paragraph (f) 

or (g) of this section or § 146.137(g) 

changes the requirements of §§ 147.150 

and 156.115 of this subchapter, 

providing that a health insurance issuer 

offering non-grandfathered health 

insurance coverage in the individual or 

small group market that is required to 

provide mental health and substance 

use disorder services, including 

behavioral health treatment services, as 

part of essential health benefits required 

under §§ 156.110(a)(5) and 156.115(a) of 

this subchapter, must comply with the 

requirements under section 2726 of the 

PHS Act and its implementing 

regulations in this section and § 146.137 

to satisfy the requirement to provide 

coverage for mental health and 

substance use disorder services, 

including behavioral health treatment, 

as part of essential health benefits. 

* * * * * 

(i) * * * 

(1) In general. Except as provided in 

paragraph (i)(2) of this section— 

(i) This section applies to group 

health plans and health insurance 

issuers offering group health insurance 

coverage on the first day of the first plan 

year beginning on or after January 1, 

2025, except that the requirements of 

paragraphs (c)(2)(ii)(A), (c)(4)(i)(B), and 

(c)(4)(iii) of this section apply on the 

first day of the first plan year beginning 

on or after January 1, 2026. 

(ii) Until the applicability date in 

paragraph (i)(1)(i) of this section, plans 

and issuers are required to continue to 

comply with 45 CFR 146.136, revised as 

of October 1, 2023. 

* * * * * 

(j) Severability. If any provision of this 

section is held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, or stayed 

pending further agency action, the 

provision shall be construed so as to 

continue to give the maximum effect to 

the provision permitted by law, unless 

such holding shall be one of invalidity 

or unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

■ 9. Add § 146.137 to read as follows: 

§ 146.137 Nonquantitative treatment 

limitation comparative analysis 

requirements. 

(a) Meaning of terms. Unless 

otherwise stated in this section, the 

terms of this section have the meanings 

indicated in § 146.136(a)(2). 

(b) In general. In the case of a group 

health plan (or health insurance issuer 

offering coverage in connection with a 

group health plan) that provides both 

medical/surgical benefits and mental 

health or substance use disorder 

benefits and that imposes any 

nonquantitative treatment limitation on 

mental health or substance use disorder 

benefits, the plan or issuer must perform 

and document a comparative analysis of 

the design and application of each 

nonquantitative treatment limitation 

applicable to mental health or substance 

use disorder benefits. Each comparative 

analysis must comply with the content 

requirements of paragraph (c) of this 

section and be made available to the 

Secretary, upon request, in the manner 

required by paragraphs (d) and (e) of 

this section. 

(c) Comparative analysis content 

requirements. With respect to each 

nonquantitative treatment limitation 

applicable to mental health or substance 

use disorder benefits under a group 

health plan (or health insurance 

coverage offered in connection with a 

group health plan), the comparative 

analysis performed by the plan or issuer 

must include, at minimum, the elements 

specified in this paragraph (c). In 

addition to the comparative analysis for 

each nonquantitative treatment 

limitation, each plan or issuer must 

prepare and make available to the 

Secretary, upon request, a written list of 

all nonquantitative treatment limitations 

imposed under the plan or coverage. 

(1) Description of the nonquantitative 

treatment limitation. The comparative 

analysis must include, with respect to 

the nonquantitative treatment limitation 

that is the subject of the comparative 

analysis: 

(i) Identification of the 

nonquantitative treatment limitation, 


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including the specific terms of the plan 

or coverage or other relevant terms 

regarding the nonquantitative treatment 

limitation, the policies or guidelines 

(internal or external) in which the 

nonquantitative treatment limitation 

appears or is described, and the 

applicable sections of any other relevant 

documents, such as provider contracts, 

that describe the nonquantitative 

treatment limitation; 

(ii) Identification of all mental health 

or substance use disorder benefits and 

medical/surgical benefits to which the 

nonquantitative treatment limitation 

applies, including a list of which 

benefits are considered mental health or 

substance use disorder benefits and 

which benefits are considered medical/ 

surgical benefits; and 

(iii) A description of which benefits 

are included in each classification set 

forth in § 146.136(c)(2)(ii)(A). 

(2) Identification and definition of the 

factors and evidentiary standards used 

to design or apply the nonquantitative 

treatment limitation. The comparative 

analysis must include, with respect to 

every factor considered or relied upon 

to design the nonquantitative treatment 

limitation or apply the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits and 

medical/surgical benefits: 

(i) Identification of every factor 

considered or relied upon, as well as the 

evidentiary standards considered or 

relied upon to design or apply each 

factor and the sources from which each 

evidentiary standard was derived, in 

determining which mental health or 

substance use disorder benefits and 

which medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; and 

(ii) A definition of each factor, 

including: 

(A) A detailed description of the 

factor; 

(B) A description of each evidentiary 

standard used to design or apply each 

factor (and the source of each 

evidentiary standard) identified under 

paragraph (c)(2)(i) of this section; and 

(C) A description of any steps the plan 

or issuer has taken to correct, cure, or 

supplement any information, evidence, 

sources, or standards that would 

otherwise have been considered biased 

or not objective under 

§ 146.136(c)(4)(i)(B)(1) in the absence of 

such steps. 

(3) Description of how factors are 

used in the design and application of 

the nonquantitative treatment 

limitation. The comparative analysis 

must include a description of how each 

factor identified and defined under 

paragraph (c)(2) of this section is used 

in the design or application of the 

nonquantitative treatment limitation to 

mental health and substance use 

disorder benefits and medical/surgical 

benefits in a classification, including: 

(i) A detailed explanation of how each 

factor identified and defined in 

paragraph (c)(2) of this section is used 

to determine which mental health or 

substance use disorder benefits and 

which medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; 

(ii) An explanation of the evidentiary 

standards or other information or 

sources (if any) considered or relied 

upon in designing or applying the 

factors or relied upon in designing and 

applying the nonquantitative treatment 

limitation, including in the 

determination of whether and how 

mental health or substance use disorder 

benefits or medical/surgical benefits are 

subject to the nonquantitative treatment 

limitation; 

(iii) If the application of the factor 

depends on specific decisions made in 

the administration of benefits, the 

nature of the decisions, the timing of the 

decisions, and the professional 

designations and qualifications of each 

decision maker; 

(iv) If more than one factor is 

identified and defined in paragraph 

(c)(2) of this section, an explanation of: 

(A) How all of the factors relate to 

each other; 

(B) The order in which all the factors 

are applied, including when they are 

applied; 

(C) Whether and how any factors are 

given more weight than others; and 

(D) The reasons for the ordering or 

weighting of the factors; and 

(v) Any deviations or variations from 

a factor, its applicability, or its 

definition (including the evidentiary 

standards used to define the factor and 

the information or sources from which 

each evidentiary standard was derived), 

such as how the factor is used 

differently to apply the nonquantitative 

treatment limitation to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

and a description of how the plan or 

issuer establishes such deviations or 

variations. 

(4) Demonstration of comparability 

and stringency as written. The 

comparative analysis must evaluate 

whether, in any classification, under the 

terms of the plan (or health insurance 

coverage) as written, any processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the nonquantitative treatment 

limitation to mental health or substance 

use disorder benefits are comparable to, 

and are applied no more stringently 

than, the processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

nonquantitative treatment limitation 

with respect to medical/surgical 

benefits. The comparative analysis must 

include, with respect to the 

nonquantitative treatment limitation 

and the factors used in designing and 

applying the nonquantitative treatment 

limitation: 

(i) Documentation of each factor 

identified and defined in paragraph 

(c)(2) of this section that was applied to 

determine whether the nonquantitative 

treatment limitation applies to mental 

health or substance use disorder 

benefits and medical/surgical benefits in 

a classification, including, as relevant: 

(A) Quantitative data, calculations, or 

other analyses showing whether, in each 

classification in which the 

nonquantitative treatment limitation 

applies, mental health or substance use 

disorder benefits and medical/surgical 

benefits met or did not meet any 

applicable threshold identified in the 

relevant evidentiary standard to 

determine that the nonquantitative 

treatment limitation would or would not 

apply; and 

(B) Records maintained by the plan or 

issuer documenting the consideration 

and application of all factors and 

evidentiary standards, as well as the 

results of their application; 

(ii) In each classification in which the 

nonquantitative treatment limitation 

applies to mental health or substance 

use disorder benefits, a comparison of 

how the nonquantitative treatment 

limitation, as written, is designed and 

applied to mental health or substance 

use disorder benefits and to medical/ 

surgical benefits, including the specific 

provisions of any forms, checklists, 

procedure manuals, or other 

documentation used in designing and 

applying the nonquantitative treatment 

limitation or that address the 

application of the nonquantitative 

treatment limitation; 

(iii) Documentation demonstrating 

how the factors are comparably applied, 

as written, to mental health or substance 

use disorder benefits and medical/ 

surgical benefits in each classification, 

to determine which benefits are subject 

to the nonquantitative treatment 

limitation; and 

(iv) An explanation of the reasons for 

any deviations or variations in the 

application of a factor used to apply the 

nonquantitative treatment limitation, or 

the application of the nonquantitative 

treatment limitation, to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 


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and how the plan or issuer establishes 

such deviations or variations, including: 

(A) In the definition of the factors, the 

evidentiary standards used to define the 

factors, and the sources from which the 

evidentiary standards were derived; 

(B) In the design of the factors or 

evidentiary standards; or 

(C) In the application or design of the 

nonquantitative treatment limitation. 

(5) Demonstration of comparability 

and stringency in operation. The 

comparative analysis must evaluate 

whether, in any classification, in 

operation, the processes, strategies, 

evidentiary standards, or other factors 

used in designing and applying the 

nonquantitative treatment limitation to 

mental health or substance use disorder 

benefits are comparable to, and are 

applied no more stringently than, the 

processes, strategies, evidentiary 

standards, or other factors used in 

designing and applying the limitation 

with respect to medical/surgical 

benefits. The comparative analysis must 

include, with respect to the 

nonquantitative treatment limitation 

and the factors used in designing and 

applying the nonquantitative treatment 

limitation: 

(i) A comprehensive explanation of 

how the plan or issuer evaluates 

whether, in operation, the processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the nonquantitative treatment 

limitation to mental health or substance 

use disorder benefits in a classification 

are comparable to, and are applied no 

more stringently than, the processes, 

strategies, evidentiary standards, or 

other factors used in designing and 

applying the nonquantitative treatment 

limitation with respect to medical/ 

surgical benefits, including: 

(A) An explanation of any 

methodology and underlying data used 

to demonstrate the application of the 

nonquantitative treatment limitation, in 

operation; 

(B) The sample period, inputs used in 

any calculations, definitions of terms 

used, and any criteria used to select the 

mental health or substance use disorder 

benefits and medical/surgical benefits to 

which the nonquantitative treatment 

limitation is applicable; 

(C) With respect to a nonquantitative 

treatment limitation for which relevant 

data is temporarily unavailable as 

described in § 146.136(c)(4)(iii)(A)(3)(i), 

a detailed explanation of the lack of 

relevant data, the basis for the plan’s or 

issuer’s conclusion that there is a lack 

of relevant data, and when and how the 

data will become available and be 

collected and analyzed; and 

(D) With respect to a nonquantitative 

treatment limitation for which no data 

exist that can reasonably assess any 

relevant impact of the nonquantitative 

treatment limitation on relevant 

outcomes related to access to mental 

health and substance use disorder 

benefits and medical/surgical benefits as 

described in § 146.136(c)(4)(iii)(A)(3)(ii), 

a reasoned justification as to the basis 

for the conclusion that there are no data 

that can reasonably assess the 

nonquantitative treatment limitation’s 

impact, an explanation of why the 

nature of the nonquantitative treatment 

limitation prevents the plan or issuer 

from reasonably measuring its impact, 

an explanation of what data was 

considered and rejected, and 

documentation of any additional 

safeguards or protocols used to ensure 

that the nonquantitative treatment 

limitation complies with § 146.136(c)(4); 

(ii) Identification of the relevant data 

collected and evaluated, as required 

under § 146.136(c)(4)(iii)(A); 

(iii) Documentation of the outcomes 

that resulted from the application of the 

nonquantitative treatment limitation to 

mental health or substance use disorder 

benefits and medical/surgical benefits, 

including: 

(A) The evaluation of relevant data as 

required under § 146.136(c)(4)(iii)(A); 

and 

(B) A reasoned justification and 

analysis that explains why the plan or 

issuer concluded that any differences in 

the relevant data do or do not suggest 

the nonquantitative treatment limitation 

contributes to material differences in 

access to mental health or substance use 

disorder benefits as compared to 

medical/surgical benefits, in accordance 

with § 146.136(c)(4)(iii)(B)(2); 

(iv) A detailed explanation of any 

material differences in access 

demonstrated by the outcomes 

evaluated under paragraph (c)(5)(iii) of 

this section, including: 

(A) A reasoned explanation of any 

material differences in access that are 

not attributable to differences in the 

comparability or relative stringency of 

the nonquantitative treatment limitation 

as applied to mental health or substance 

use disorder benefits and medical/ 

surgical benefits (including any 

considerations beyond a plan’s or 

issuer’s control that contribute to the 

existence of material differences) and a 

detailed explanation of the bases for 

concluding that material differences are 

not attributable to differences in the 

comparability or relative stringency of 

the nonquantitative treatment 

limitation; and 

(B) To the extent differences in access 

to mental health or substance use 

disorder benefits are attributable to 

generally recognized independent 

professional medical or clinical 

standards or carefully circumscribed 

measures reasonably and appropriately 

designed to detect or prevent and prove 

fraud and abuse that minimize the 

negative impact on access to appropriate 

mental health and substance use 

disorder benefits, and such standards or 

measures are used as the basis for a 

factor or evidentiary standard used to 

design or apply a nonquantitative 

treatment limitation, documentation 

explaining how any such differences are 

attributable to those standards or 

measures, as required in 

§ 146.136(c)(4)(iii)(B)(2)(ii); and 

(v) A discussion of the actions that 

have been or are being taken by the plan 

or issuer to address any material 

differences in access to mental health or 

substance use disorder benefits as 

compared to medical/surgical benefits, 

including the actions the plan or issuer 

has taken or is taking under 

§ 146.136(c)(4)(iii)(B)(1) to address 

material differences to comply, in 

operation, with § 146.136(c)(4), 

including, as applicable: 

(A) A reasoned explanation of any 

material differences in access to mental 

health or substance use disorder 

benefits as compared to medical/ 

surgical benefits that persist despite 

reasonable actions that have been or are 

being taken; and 

(B) For a plan or issuer designing and 

applying one or more nonquantitative 

treatment limitations related to network 

composition, a discussion of the actions 

that have been or are being taken to 

address material differences in access to 

in-network mental health and substance 

use disorder benefits as compared to innetwork medical/surgical benefits, 

including those listed in 

§ 146.136(c)(4)(iii)(C). 

(6) Findings and conclusions. The 

comparative analysis must address the 

findings and conclusions as to the 

comparability of the processes, 

strategies, evidentiary standards, and 

other factors used in designing and 

applying the nonquantitative treatment 

limitation to mental health or substance 

use disorder benefits and medical/ 

surgical benefits within each 

classification, and the relative 

stringency of their application, both as 

written and in operation, and include: 

(i) Any findings or conclusions 

indicating that the plan or coverage is or 

is not (or might or might not be) in 

compliance with the requirements of 

§ 146.136(c)(4), including any additional 

actions the plan or issuer has taken or 

intends to take to address any potential 

areas of concern or noncompliance; 


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(ii) A reasoned and detailed 

discussion of the findings and 

conclusions described in paragraph 

(c)(6)(i) of this section; 

(iii) Citations to any additional 

specific information not otherwise 

included in the comparative analysis 

that supports the findings and 

conclusions described in paragraph 

(c)(6)(i) of this section not otherwise 

discussed in the comparative analysis; 

(iv) The date the analysis is 

completed and the title and credentials 

of all relevant persons who participated 

in the performance and documentation 

of the comparative analysis; and 

(v) If the comparative analysis relies 

upon an evaluation by a reviewer or 

consultant considered by the plan or 

issuer to be an expert, an assessment of 

each expert’s qualifications and the 

extent to which the plan or issuer 

ultimately relied upon each expert’s 

evaluation in performing and 

documenting the comparative analysis 

of the design and application of the 

nonquantitative treatment limitation 

applicable to both mental health or 

substance use disorder benefits and 

medical/surgical benefits. 

(d) Requirements related to 

submission of comparative analyses to 

the Secretary upon request—(1) Initial 

request by the Secretary for comparative 

analysis. A group health plan (or health 

insurance issuer offering coverage in 

connection with a group health plan) 

must make the comparative analysis 

required by paragraph (b) of this section 

available and submit it to the Secretary 

within 10 business days of receipt of a 

request from the Secretary (or an 

additional period of time specified by 

the Secretary). 

(2) Additional information required 

after a comparative analysis is deemed 

to be insufficient. In instances in which 

the Secretary determines that the plan 

or issuer has not submitted sufficient 

information under paragraph (d)(1) of 

this section for the Secretary to 

determine whether the comparative 

analysis required in paragraph (b) of this 

section complies with paragraph (c) of 

this section or whether the plan or 

issuer complies with § 146.136(c)(4), the 

Secretary will specify to the plan or 

issuer the additional information the 

plan or issuer must submit to the 

Secretary to be responsive to the request 

under paragraph (d)(1). Any such 

information must be provided to the 

Secretary by the plan or issuer within 10 

business days after the Secretary 

specifies the additional information to 

be submitted (or an additional period of 

time specified by the Secretary). 

(3) Initial determination of 

noncompliance, required action, and 

corrective action plan. In instances in 

which the Secretary reviewed the 

comparative analysis submitted under 

paragraph (d)(1) of this section and any 

additional information submitted under 

paragraph (d)(2) of this section, and 

made an initial determination that the 

plan or issuer is not in compliance with 

the requirements of § 146.136(c)(4) or 

this section, the plan or issuer must 

respond to the initial determination by 

the Secretary and specify the actions the 

plan or issuer will take to bring the plan 

or coverage into compliance, and 

provide to the Secretary additional 

comparative analyses meeting the 

requirements of paragraph (c) of this 

section that demonstrate compliance 

with § 146.136(c)(4), not later than 45 

calendar days after the Secretary’s 

initial determination that the plan or 

issuer is not in compliance. 

(4) Requirement to notify participants 

and beneficiaries of final determination 

of noncompliance—(i) In general. If the 

Secretary makes a final determination of 

noncompliance, the plan or issuer must 

notify all participants and beneficiaries 

enrolled in the plan or coverage that the 

plan or issuer has been determined to 

not be in compliance with the 

requirements of § 146.136(c)(4) or this 

section with respect to such plan or 

coverage. Such notice must be provided 

within 7 business days of receipt of the 

final determination of noncompliance, 

and the plan or issuer must provide a 

copy of the notice to the Secretary, any 

service provider involved in the claims 

process, and any fiduciary responsible 

for deciding benefit claims within the 

same timeframe. 

(ii) Content of notice. The notice to 

participants and beneficiaries required 

in paragraph (d)(4)(i) of this section 

shall be written in a manner calculated 

to be understood by the average plan 

participant and must include, in plain 

language, the following information in a 

standalone notice: 

(A) The following statement 

prominently displayed on the first page, 

in no less than 14-point font: 

‘‘Attention! The Department of Health 

and Human Services has determined 

that [insert the name of group health 

plan or health insurance issuer] is not 

in compliance with the Mental Health 

Parity and Addiction Equity Act.’’; 

(B) A summary of changes the plan or 

issuer has made as part of its corrective 

action plan specified to the Secretary 

following the initial determination of 

noncompliance, including an 

explanation of any opportunity for a 

participant or beneficiary to have a 

claim for benefits submitted or 

reprocessed; 

(C) A summary of the Secretary’s final 

determination that the plan or issuer is 

not in compliance with § 146.136(c)(4) 

or this section, including any provisions 

or practices identified as being in 

violation of § 146.136(c)(4) or this 

section, additional corrective actions 

identified by the Secretary in the final 

determination notice, and information 

on how participants and beneficiaries 

can obtain from the plan or issuer a 

copy of the final determination of 

noncompliance; 

(D) Any additional actions the plan or 

issuer is taking to come into compliance 

with § 146.136(c)(4) or this section, 

when the plan or issuer will take such 

actions, and a clear and accurate 

statement explaining whether the 

Secretary has concurred with those 

actions; and 

(E) Contact information for questions 

and complaints, and a statement 

explaining how participants and 

beneficiaries can obtain more 

information about the notice, including: 

(1) The plan’s or issuer’s phone 

number and an email or web portal 

address; and 

(2) The Centers for Medicare & 

Medicaid Services’ phone number and 

email or web portal address. 

(iii) Manner of notice. The plan or 

issuer must make the notice required 

under paragraph (d)(4)(i) of this section 

available in paper form, or 

electronically (such as by email or an 

internet posting) if: 

(A) The format is readily accessible; 

(B) The notice is provided in paper 

form free of charge upon request; and 

(C) In a case in which the electronic 

form is an internet posting, the plan or 

issuer timely notifies the participant or 

beneficiary in paper form (such as a 

postcard) or email, that the documents 

are available on the internet, provides 

the internet address, includes the 

statement required in paragraph 

(d)(4)(ii)(A) of this section, and notifies 

the participant or beneficiary that the 

documents are available in paper form 

upon request. 

(e) Requests for a copy of a 

comparative analysis. In addition to 

making a comparative analysis available 

upon request to the Secretary, a plan or 

issuer must make available a copy of the 

comparative analysis required by 

paragraph (b) of this section when 

requested by: 

(1) Any applicable State authority; 

and 

(2) A participant or beneficiary 

(including a provider or other person 

acting as a participant’s or beneficiary’s 

authorized representative) who has 

received an adverse benefit 


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Federal Register / Vol. 89, No. 184 / Monday, September 23, 2024 / Rules and Regulations 77751 

determination related to mental health 

or substance use disorder benefits. 

(f) Rule of construction. Nothing in 

this section or § 146.136 shall be 

construed to prevent the Secretary from 

acting within the scope of existing 

authorities to address violations of 

§ 146.136 or this section. 

(g) Applicability. The provisions of 

this section apply to group health plans 

and health insurance issuers offering 

group health insurance coverage 

described in § 146.136(e), to the extent 

the plan or issuer is not exempt under 

§ 146.136(f) or (g), on the first day of the 

first plan year beginning on or after 

January 1, 2025, except the 

requirements of paragraphs (c)(2)(ii)(C), 

(c)(5)(i)(C) and (D), and (c)(5)(ii) through 

(v) of this section apply on the first day 

of the first plan year beginning on or 

after January 1, 2026. 

(h) Severability. If any provision of 

this section is held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, or stayed 

pending further agency action, the 

provision shall be construed so as to 

continue to give the maximum effect to 

the provision permitted by law, unless 

such holding shall be one of invalidity 

or unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

■ 10. Amend § 146.180 by: 

■ a. Revising paragraph (a)(2); 

■ b. Redesignating paragraphs (a)(3) 

through (7) as paragraphs (a)(4) through 

(8); 

■ c. Adding new paragraph (a)(3); 

■ d. Revising newly redesignated 

paragraphs (a)(5) and (a)(7)(i) and 

paragraph (f)(1); and 

■ e. Adding paragraph (f)(4)(iii). 

The revisions and additions read as 

follows: 

§ 146.180 Treatment of non-Federal 

governmental plans. 

(a) * * * 

(2) General rule. For plans years 

beginning on or after September 23, 

2010, a sponsor of a non-Federal 

governmental plan may elect to exempt 

its plan, to the extent the plan is not 

provided through health insurance 

coverage (that is self-funded), from one 

or more of the requirements described 

in paragraphs (a)(1)(iv) through (vii) of 

this section, except as provided in 

paragraphs (a)(3) and (f)(1) of this 

section with respect to the requirements 

described in paragraph (a)(1)(v) of this 

section. 

(3) Sunset of election option related to 

parity in mental health and substance 

use disorder benefits. A sponsor of a 

non-Federal governmental plan may not 

newly elect to exempt its plans from the 

requirements described in paragraph 

(a)(1)(v) of this section on or after 

December 29, 2022. 

* * * * * 

(5) Examples—(i) Example 1. A nonFederal governmental employer has 

elected to exempt its self-funded group 

health plan from all of the requirements 

described in paragraph (a)(1) of this 

section. The plan year commences 

September 1st of each year. The plan is 

not subject to the provisions of 

paragraph (a)(2) of this section until the 

plan year that commences on September 

1, 2011. Accordingly, for that plan year 

and any subsequent plan years, the plan 

sponsor may elect to exempt its plan 

only from the requirements described in 

paragraphs (a)(1)(iv) through (vii) of this 

section, subject to paragraphs (a)(3) and 

(f)(1) of this section with respect to the 

requirements described in paragraph 

(a)(1)(v) of this section. 

(ii) Example 2. A non-Federal 

governmental employer has elected to 

exempt its collectively bargained selffunded plan from all of the 

requirements described in paragraph 

(a)(1) of this section. The collective 

bargaining agreement applies to 5 plan 

years, October 1, 2009, through 

September 30, 2014. For the plan year 

that begins on October 1, 2014, the plan 

sponsor is no longer permitted to elect 

to exempt its plan from the 

requirements described in paragraphs 

(a)(1)(i) through (iii) of this section. 

Accordingly, for that plan year and any 

subsequent plan years, the plan sponsor 

may elect to exempt its plan only from 

the requirements described in 

paragraphs (a)(1)(iv) through (vii) of this 

section, subject to paragraphs (a)(3) and 

(f)(1) of this section with respect to the 

requirements described in paragraph 

(a)(1)(v) of this section. 

* * * * * 

(7) * * * 

(i) Subject to paragraph (a)(7)(ii) of 

this section, the purchase of stop-loss or 

excess risk coverage by a self-funded 

non-Federal governmental plan does not 

prevent an election under this section. 

* * * * * 

(f) * * * 

(1) Election renewal. A plan sponsor 

may renew an election under this 

section through subsequent elections. 

Notwithstanding the previous sentence 

and except as provided in paragraph 

(f)(4)(iii) of this section, an election with 

respect to the requirements described in 

paragraph (a)(1)(v) of this section 

expiring on or after June 27, 2023, may 

not be renewed. The timeliness 

standards described in paragraph (c) of 

this section apply to election renewals 

under paragraph (f) of this section. 

* * * * * 

(4) * * * 

(iii) In the case of a plan that is subject 

to multiple collective bargaining 

agreements of varying lengths and that 

has an election with respect to the 

requirements described in paragraph 

(a)(1)(v) of this section in effect as of 

December 29, 2022, that expires on or 

after June 27, 2023, the plan may extend 

such election until the date on which 

the term of the last such agreement 

expires. 

* * * * * 

PART 147—HEALTH INSURANCE 

REFORM REQUIREMENTS FOR THE 

GROUP AND INDIVIDUAL HEALTH 

INSURANCE MARKETS 

■ 11. The authority citation for part 147 

continues to read as follows: 

Authority: 42 U.S.C. 300gg through 300gg– 

63, 300gg–91, 300gg–92, and 300gg–111 

through 300gg–139, as amended, and section 

3203, Pub. L. 116–136, 134 Stat. 281. 

■ 12. Revise § 147.160 to read as 

follows: 

§ 147.160 Parity in mental health and 

substance use disorder benefits. 

(a) In general. The provisions of 

§§ 146.136 and 146.137 of this 

subchapter apply to individual health 

insurance coverage offered by a health 

insurance issuer in the same manner 

and to the same extent as such 

provisions apply to health insurance 

coverage offered by a health insurance 

issuer in connection with a group health 

plan in the large group market. 

(b) Applicability date. The provisions 

of this section apply for policy years 

beginning on or after January 1, 2026. 

Until the applicability date in the 

preceding sentence, issuers are required 

to continue to comply with 45 CFR 

147.160, incorporating 45 CFR 146.136, 

each revised as of October 1, 2023. This 

section applies to non-grandfathered 

and grandfathered health plans as 

defined in § 147.140. 

[FR Doc. 2024–20612 Filed 9–13–24; 4:15 pm] 

BILLING CODE 4510–29–P; 4830–01–P; 4120–01–P 


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