Behavioral Health Coverage Transparency Act of 2016

To strengthen parity in mental health and substance use disorder benefits. 1. Short title This Act may be cited as the Behavioral Health Coverage Transparency Act of 2016 2. Strengthening parity in mental health and substance use disorder benefits (a) Public Health Service Act Section 2726 of the Public Health Service Act ( 42 U.S.C. 300gg–26 (1) in subsection (a), by adding at the end the following: (6) Disclosure and enforcement requirements (A) Disclosure requirements (i) Regulations Not later than September 30, 2016, the Secretary, in cooperation with the Secretaries of Labor and the Treasury, as appropriate, shall issue additional regulations for carrying out this section, including an explanation of documents that must be disclosed by group health plans or health insurance issuers offering group or individual health insurance coverage, the process governing the disclosure of such documents, and analyses that must be conducted by such plans and issuers to comply with this section. (ii) Requirements A group health plan or a health insurance issuer offering group or individual health insurance coverage shall disclose to the Secretary in a standardized format documents that include— (I) the specific analyses performed to ensure compliance with this section and any regulations promulgated pursuant to this section; (II) a description of the application of non-quantitative treatment limitations (in this paragraph referred to as NQTLs (aa) the specific factors the plan or issuer used in performing its NQTLs analysis; (bb) the specific evidentiary standards relied on to evaluate such factors; (cc) how the evidentiary standards are applied to each service category for mental health, substance use disorders, medical benefits, and surgical benefits; (dd) a disclosure of the results of the analyses of the specific evidentiary standards in each service category; and (ee) a disclosure of the specific findings of such plan or issuer in each service category and the conclusions reached with respect to whether the processes, strategies, evidentiary standards, or other factors used in applying NQTLs to mental health or substance use disorder benefits are comparable to, and applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in applying NQTLs with respect to medical and surgical benefits in the same classification; and (III) the rates of and reasons for denial by the plan or issuer for outpatient and inpatient mental health and substance use disorder services compared to the rates of and reasons for denial of claims for medical and surgical services. (iii) Guidance The Secretary, in cooperation with the Secretaries of Labor and the Treasury, as appropriate, shall issue guidance to group health plans or health insurance issuers offering group or individual health insurance coverage on how to satisfy the requirements of this section with respect to making information available to current and potential participants and beneficiaries. Such information shall include certificate of coverage documents and instruments under which the plan or coverage involved is administered and operated that specify, include, or refer to procedures, formulas, and methodologies applied to determine a participant or beneficiary’s benefit under the plan or coverage, regardless of whether such information is contained in a document designated as the plan document (iv) Definitions In this paragraph, the terms non-quantitative treatment limitations comparable to applied no more stringently than (B) Enforcement (i) Process for complaints The Secretary, in cooperation with the Secretaries of Labor and the Treasury, as appropriate, shall issue guidance to clarify the process and timeline for current and potential participants and beneficiaries (and authorized representatives and health care providers of such participants and beneficiaries) of group health plans or health insurance issuers offering group or individual health insurance coverage to file formal complaints of such plans or issuers being in violation of this section, including guidance, by plan type, on the relevant State, regional, and national offices, including the consumer parity unit established under paragraph (7), with which such complaints should be filed. (ii) Authority for public enforcement The Secretary, in consultation with the Secretaries of Labor and the Treasury, shall make available to the public on the website of the consumer parity unit established under paragraph (7) information on audits and investigations of group health plans and health insurance issuers conducted under this section. Such information shall not contain any personally identifiable information. (iii) Audits (I) Randomized audits The Secretary, in cooperation with the Secretaries of Labor and the Treasury, may conduct randomized audits of group health plans or health insurance issuers offering group or individual health insurance coverage to determine compliance with this section. Such audits shall be conducted on not fewer than 12 plans and issuers per plan year. Information from such audits shall be made plainly available on the website of the consumer parity unit established under paragraph (7). (II) Additional audits In the case of a group health plan or health insurance issuer offering group or individual health insurance coverage with respect to which any claim has been filed during a plan year, the Secretary may audit the books and records of such plan or issuer to determine compliance with this section. Information detailing the results of the audit shall be made available on the website of the consumer parity unit established under paragraph (7). (7) Consumer parity unit (A) In general The Secretary, in cooperation with the Secretaries of Labor and the Treasury, shall establish a consumer parity unit (referred to in this paragraph as the unit (i) developing and administering a single, toll-free telephone number, an Internet website, and a database, or using an existing database, to facilitate the centralized collection of, monitoring of, and response to consumer complaints or inquiries regarding violations of this section, section 712 of the Employee Retirement Income Security Act of 1974 or section 9812(a)(6) (ii) providing information to health care consumers that is submitted to the Secretary, the Secretary of Labor, and the Secretary of the Treasury under paragraph (6), section 712(a)(6) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1185a(a)(6) section 9812(a)(6) (B) Response to consumer complaints and inquiries (i) Timely response to consumers The Secretary of Health and Human Services, in cooperation with the Secretaries of Labor and the Treasury, shall establish reasonable procedures to provide a timely response (in writing if appropriate) to consumers regarding complaints received by the unit against, or inquiries concerning, a group health plan or health insurance issuer offering group or individual health insurance coverage, including— (I) steps that have been taken by the appropriate State or Federal enforcement agency in response to the complaint or inquiry of the consumer; (II) any responses received by the appropriate State or Federal enforcement agency from the group health plan or health insurance issuer offering group or individual health insurance coverage; (III) any follow-up actions or planned follow-up actions by the appropriate regulator in response to the complaint or inquiry of the consumer; and (IV) contact information of the appropriate enforcement agency for the consumer to follow up on the complaint or inquiry. (ii) Timely response to regulators A group health plan or health insurance issuer offering group or individual health insurance coverage shall provide a timely response (in writing if appropriate) to the appropriate State or Federal enforcement agency having jurisdiction over such plan or issuer concerning a consumer complaint or inquiry submitted to the unit including— (I) steps that have been taken by the plan or issuer to respond to the complaint or inquiry of the consumer; (II) any responses received by the plan or issuer from the consumer; and (III) follow-up actions or planned follow-up actions by the plan or issuer in response to the complaint or inquiry of the consumer. ; and (2) by adding at the end the following: (f) Annual reports (1) Provision of information by States Not later than December 31, 2017, and annually thereafter, each State health insurance commissioner shall submit to the Secretary a report on compliance with this section of group health plans or health insurance issuers offering group or individual health insurance coverage in such State. (2) Requirement of comparison To ensure that group health plans or health insurance issuers offering group or individual health insurance coverage provide comparable coverage for mental health and substance use disorder benefits in accordance with this section, as part of the report submitted under paragraph (1), a State health insurance commissioner shall compare the financial requirements and treatment limitations imposed by such issuers and plans for mental health and substance use disorder services and those requirements and limitations imposed by such issuers and plans on medical and surgical benefits. (3) Contents of reports The reports submitted under paragraph (1) shall be made publicly available on the website of the consumer parity unit established under subsection (a)(7) and include the following information, broken down for each group health plan or health insurance issuer offering group or individual health insurance coverage: (A) The mental health and substance use disorder benefits provided by the plan or issuer. (B) New mental health or substance use disorder treatments that have been approved for coverage. (C) Standards for admission to plan provider networks, including reimbursement rates, and an accurate, up-to-date provider network listing, including information on which providers are accepting new patients. (D) Non-quantitative treatment limitations on coverage, including— (i) medical management standards limiting or excluding benefits based on medical necessity or medical appropriateness, or based on whether a treatment is experimental or investigative; (ii) formulary design for prescription drugs; (iii) plan methods used to determine usual, customary, and reasonable fee charges; (iv) 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 (v) exclusions based on failure to complete a course of treatment; and (vi) restrictions based on geographic location, facility type, provider specialty, and other criteria that might otherwise limit the scope or duration of benefits. (E) Information needed to calculate out-of-pocket costs. . (b) Employee Retirement Income Security Act of 1974 Section 712(a) of the Employee Retirement Income Security Act of 1974 ( 29 U.S.C. 1185a(a) (6) Disclosure and enforcement requirements (A) Disclosure requirements (i) Regulations Not later than June 30, 2016, the Secretary, in cooperation with the Secretaries of Health and Human Services and the Treasury, as appropriate, shall issue additional regulations for carrying out this section, including an explanation of documents that must be disclosed by group health plans (or health insurance coverage offered in connection with such plans), the process governing the disclosure of such documents, and analyses that must be conducted by such plans or coverage to comply with this section. (ii) Requirements A group health plan (or health insurance coverage offered in connection with such a plan) shall disclose to the Secretary in a standardized format documents that include— (I) the specific analyses performed to ensure compliance with this section and any regulations promulgated pursuant to this section; (II) a description of the application of non-quantitative treatment limitations (in this paragraph referred to as NQTLs (aa) the specific factors the plan or coverage used in performing its NQTLs analysis; (bb) the specific evidentiary standards relied on to evaluate such factors; (cc) how the evidentiary standards are applied to each service category for mental health, substance use disorders, medical benefits, and surgical benefits; (dd) a disclosure of the results of the analyses of the specific evidentiary standards in each service category; and (ee) a disclosure of the specific findings of such plan or coverage in each service category and the conclusions reached with respect to whether the processes, strategies, evidentiary standards, or other factors used in applying NQTLs to mental health or substance use disorder benefits are comparable to, and applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in applying NQTLs with respect to medical and surgical benefits in the same classification; and (III) the rates of and reasons for denial by the plan or coverage for outpatient and inpatient mental health and substance use disorder services compared to the rates of and reasons for denial of claims for medical and surgical services. (iii) Guidance The Secretary, in cooperation with the Secretaries of Health and Human Services and the Treasury, as appropriate, shall issue guidance to group health plans (and health insurance coverage offered in connection with such plans) on how to satisfy the requirements of this section with respect to making information available to current and potential participants and beneficiaries. Such information shall include certificate of coverage documents and instruments under which the plan or coverage involved is administered and operated that specify, include, or refer to procedures, formulas, and methodologies applied to determine a participant or beneficiary’s benefit under the plan or coverage, regardless of whether such information is contained in a document designated as the plan document (iv) Definitions In this paragraph, the terms non-quantitative treatment limitations comparable to applied no more stringently than (B) Enforcement (i) Process for complaints The Secretary, in cooperation with the Secretaries of Health and Human Services and the Treasury, as appropriate, shall issue guidance to clarify the process and timeline for current and potential participants and beneficiaries (and authorized representatives and health care providers of such participants and beneficiaries) of group health plans (or health insurance coverage offered in connection with such a plan) to file formal complaints of such plans or coverage being in violation of this section, including guidance, by plan type, on the relevant State, regional, and national offices with which such complaints should be filed. (ii) Authority for public enforcement The Secretary, in consultation with the Secretaries of Labor and the Treasury, shall make available to the public on the website of the consumer parity unit established under section 2726(a)(7) of the Public Health Service Act information on audits and investigations of group health plans (and health insurance coverage offered in connection with such plans) conducted under this section. Such information shall not contain any personally identifiable information. (iii) Audits (I) Randomized audits The Secretary, in cooperation with the Secretaries of Health and Human Services and the Treasury, may conduct randomized audits of group health plans (and health insurance coverage offered in connection with such plans) to determine compliance with this section. Such audits shall be conducted on not fewer than 12 plans and coverages per plan year. Information from such audits shall be made plainly available on the website of the consumer parity unit established under section 2726(a)(7) of the Public Health Service Act. (II) Additional audits In the case of a group health plan (and health insurance coverage offered in connection with such a plan) with respect to which any claim has been filed during a plan year, the Secretary may audit the books and records of such plan or coverage to determine compliance with this section. Information detailing the results of the audit shall be made available on the website of the consumer parity unit established under section 2726(a)(7) of the Public Health Service Act. . (c) Internal Revenue Code of 1986 Section 9812(a) (6) Disclosure and enforcement requirements (A) Disclosure requirements (i) Regulations Not later than June 30, 2016, the Secretary, in cooperation with the Secretaries of Health and Human Services and Labor, as appropriate, shall issue additional regulations for carrying out this section, including an explanation of documents that must be disclosed by group health plans, the process governing the disclosure of such documents, and analyses that must be conducted by such plans to comply with this section. (ii) Requirements A group health plan shall disclose to the Secretary in a standardized format documents that include— (I) the specific analyses performed to ensure compliance with this section and any regulations promulgated pursuant to this section; (II) a description of the application of non-quantitative treatment limitations (in this paragraph referred to as NQTLs (aa) the specific factors the plan used in performing its NQTLs analysis; (bb) the specific evidentiary standards relied on to evaluate such factors; (cc) how the evidentiary standards are applied to each service category for mental health, substance use disorders, medical benefits, and surgical benefits; (dd) a disclosure of the results of the analyses of the specific evidentiary standards in each service category; and (ee) a disclosure of the specific findings of such plan in each service category and the conclusions reached with respect to whether the processes, strategies, evidentiary standards, or other factors used in applying NQTLs to mental health or substance use disorder benefits are comparable to, and applied no more stringently than, the processes, strategies, evidentiary standards, or other factors used in applying NQTLs with respect to medical and surgical benefits in the same classification; and (III) the rates of and reasons for denial by the plan for outpatient and inpatient mental health and substance use disorder services compared to the rates of and reasons for denial of claims for medical and surgical services. (iii) Guidance The Secretary, in cooperation with the Secretaries of Health and Human Services and Labor, as appropriate, shall issue guidance to group health plans on how to satisfy the requirements of this section with respect to making information available to current and potential participants and beneficiaries. Such information shall include certificate of coverage documents and instruments under which the plan involved is administered and operated that specify, include, or refer to procedures, formulas, and methodologies applied to determine a participant or beneficiary’s benefit under the plan, regardless of whether such information is contained in a document designated as the plan document (iv) Definitions In this paragraph, the terms non-quantitative treatment limitations comparable to applied no more stringently than (B) Enforcement (i) Process for complaints The Secretary, in cooperation with the Secretaries of Health and Human Services and Labor, as appropriate, shall, with respect to group health plans, issue guidance to clarify the process and timeline for current and potential participants and beneficiaries (and authorized representatives and health care providers of such participants and beneficiaries) with respect to such plans to file formal complaints of such plans being in violation of this section, including guidance, by plan type, on the relevant State, regional, and national offices with which such complaints should be filed. (ii) Authority for public enforcement The Secretary, in consultation with the Secretaries of Labor and the Treasury, shall make available to the public on the website of the consumer parity unit established under section 2726(a)(7) of the Public Health Service Act information on audits and investigations of group health plans conducted under this section. Such information shall not contain any personally identifiable information. (iii) Audits (I) Randomized audits The Secretary, in cooperation with the Secretaries of Health and Human Services and Labor, is authorized to conduct randomized audits of group health plans to determine compliance with this section. Such audits shall be conducted on not fewer than 12 plans per plan year. Information from such audits shall be made plainly available on the website of the consumer parity unit established under section 2726(a)(7) of the Public Health Service Act. (II) Additional audits In the case of a group health plan with respect to which any claim has been filed during a plan year, the Secretary may audit the books and records of such plan to determine compliance with this section. Information detailing the results of the audit shall be made available on the website of the consumer parity unit established under section 2726(a)(7) of the Public Health Service Act. . (d) GAO Study on Mental Health and Substance Use Parity Enforcement Efforts Not later than 1 year after the date of enactment of this Act, the Comptroller General of the United States, in consultation with the Secretary of Health and Human Services, the Secretary of Labor, and the Secretary of the Treasury, shall submit to Congress, and make plainly available on the website of the consumer parity unit established under section 2726(a)(7) of the Public Health Service Act ( 42 U.S.C. 300gg–26(a)(7) 29 U.S.C. 1185a (1) the number of investigations and audits that have been conducted into potential parity violations; (2) the number of enforcement actions carried out as a result of any such investigation or audit; and (3) details on any such investigation, audit, or enforcement action that do not contain any personally identifiable information. (e) Authorization of appropriations There is authorized to be appropriated $2,000,000 for each of fiscal years 2016 through 2020 to carry out this section, including the amendments made by this section.

Summary: Behavioral Health Coverage Transparency Act of 2015 This bill amends the Public Health Service Act, Employee Retirement Income Security Act of 1974 (ERISA), and Internal Revenue Code to direct the Departments of Health and Human Services (HHS), Labor, and the Treasury to require group health plans and health insurers to disclose specified information regarding compliance of plans or coverage with requirements for parity between mental health and substance use disorder benefits and medical and surgical benefits. Information that must be disclosed includes the specific analyses performed to ensure parity, findings and conclusions regarding parity in applying nonquantitative treatment limitations (e.g., tiered benefits, step therapy, or preauthorization), and a comparison of denials of claims between types of benefits. HHS, Labor, and Treasury must: (1) issue guidance on the process for current and potential participants and beneficiaries to file formal complaints of plans or insurers being in violation of the requirement for parity, and (2) conduct audits of plans and insurers to determine compliance with parity requirements and publish information from those audits. HHS must establish a consumer parity unit to collect and respond to complaints and provide information to consumers on parity. Plans and insurers must respond to consumer complaints received by the unit. State health insurance commissioners must report on compliance of plans and insurers with parity requirements and include a comparison of benefits. The Government Accountability Office must report on HHS, Labor, and Treasury efforts to enforce parity.