Most Americans obtain their health insurance coverage through the workplace. Employers typically offer health insurance coverage for employees on an annual basis through one or more health plans. Each plan year, employers can decide how many health plans to offer, whether to include coverage for MH/SU in the health plans offered, and what type of benefits those plans can include as part of their coverage.,Additionally, employers may determine if their plans’ MH/SU benefits will be managed by the same health insurer that manages their medical/surgical benefits, or if they will be managed by a separate organization that specializes in MH/SU benefits—known as a managed behavioral health organization (MBHO). Within the coverage of MH/SU that employers may offer, the types of MH/SU treatment services and the settings in which MH/SU treatment services are provided vary widely, so that a patient may receive care appropriate to the severity of the symptoms. Types of MH/SU services can include: counseling, case management, partial hospitalization, inpatient treatment, vocational rehabilitation, and a variety of residential programs. MH/SU treatment may also include prescription drugs. In addition, patients with acute symptoms may be treated by personnel in emergency rooms and hospital units, and by MH/SU crisis and outreach specialists. Patients with more subacute symptoms are treated by personnel in hospitals, day treatment programs, mental health center programs, and by different types of individual practitioners. Patients with long-term symptoms are often treated in mental health centers, residential units, and practitioners’ offices. reimbursing some portion of the remaining charges. The payment is made after the deductible is met and until the out-of-pocket expense maximum is reached—that is, the maximum amount that enrollees have to pay per year for all covered medical expenses. Coinsurance: A percentage payment made by enrollees after the deductible is met and until the out-of-pocket expense maximum is reached. Prior to the implementation of MHPAEA, private health insurance plans offered through employers that covered MH/SU typically provided lower levels of coverage for the treatment of these illnesses than for the treatment of physical illnesses. Employers often limited the coverage of MH/SU through the use of plan design features that were more restrictive for MH/SU benefits than for medical/surgical benefits. Prior to MHPAEA, MH/SU benefits were commonly subject to higher cost-sharing features such as deductibles, copayments, or coinsurance; more restrictive treatment limitations such as the number of covered hospital days or outpatient office visits; and limited out-of-network providers. Also, there were concerns that employers would limit the MH/SU treatment enrollees could receive by excluding specific MH/SU diagnoses, such as eating disorders, from their benefits. For example, prior to MHPAEA, an employer’s plan could cover unlimited hospital days and outpatient office visits and require 20 percent coinsurance for outpatient office visits for medical/surgical treatment while, for MH/SU, that same plan could cover only 30 hospital days and 20 outpatient office visits per year and impose 50 percent coinsurance for outpatient office visits. Additionally, an employer’s plan might limit the MH/SU diagnoses for which treatment was covered. Employers provided more limited coverage of MH/SU prior to MHPAEA primarily because of concerns about the cost of providing coverage for individuals with MH/SU. Concerns about the high costs associated with long-term, intensive psychotherapy and extended hospital stays, particularly for some diagnoses such as schizophrenia or major depression, could have prompted employers to impose treatment limitations on outpatient office visits and hospital days, and limits on annual or lifetime dollar amounts for treatment of MH/SU. To help address the discrepancies in health care coverage between mental illnesses and physical illnesses, Congress passed MHPAEA which strengthened federal parity requirements. coverage terms for MH/SU—when those services are offered—be no more restrictive than coverage terms for medical/surgical services. Under MHPAEA, employers are not required to offer MH/SU coverage. However, those plans that do offer mental health or substance use disorder coverage were required to comply with MHPAEA’s parity requirements for their health plan year that began on or after October 3, 2009. States may also pass laws requiring that mental health coverage sold in the state be offered on par with medical/surgical, and these requirements may be more stringent than those required by federal law. According to the National Conference of State Legislatures, state parity laws regulating mental health coverage have been passed in 49 states and the District of Columbia as of May 2011. See National Conference of State Legislatures, “State Laws Mandating or Regulating Mental Health Benefits” (Washington, D.C.: May 2011), accessed June 13, 2011, http://www.ncsl.org/default.aspx?tabid=14352. for coverage of MH/SU, including classifications of benefits and nonquantitative treatment limitations (NQTL). The IFR specifies six classifications of benefits within which parity must be applied: (1) inpatient, in-network; (2) inpatient, out-of-network; (3) outpatient, in-network; (4) outpatient, out-of-network; (5) emergency care; and (6) prescription drugs. The IFR further specifies that plans choosing to cover MH/SU benefits must offer the MH/SU benefits within any one classification when medical/surgical benefits are offered at that same classification. Thus, for plans that cover MH/SU benefits, if medical/surgical services are covered for in-patient, out-of-network care, the plan must also cover MH/SU services for in-patient, out-of-network care. An NQTL is a treatment limitation that is not expressed numerically but still limits the scope or duration of benefits for treatment under a health plan. Examples of NQTLs, some of which are noted in the IFR include: standards for provider admission to participate in a network; plan methods for determining usual, customary, and reasonable charges; pre- authorization of services; and utilization review. The IFR stipulates that employers must ensure that NQTLs are comparable across benefit classifications. Generally, if an NQTL is used for MH/SU services within a classification, it is to be applied no more stringently than an NQTL for medical/surgical services within that same classification. Most employers that responded to our survey continued to offer coverage of MH/SU through private insurance plans following the implementation of MHPAEA. The types of diagnoses and treatments included in employers’ MH/SU benefits remained largely unchanged, and some employers enhanced their MH/SU benefits by removing coverage limits as a result of MHPAEA requirements. After the issuance of the final regulations implementing MHPAEA, employers may make additional changes to their MH/SU benefits. Most employers that responded to our survey offered coverage of MH/SU both in their most current plan year—2011 or 2010—and in 2008, before MHPAEA was passed. Of the employers that responded to our survey about their coverage of MH/SU for both plan years, about 96 percent offered coverage for MH/SU for the current plan year and for 2008. Approximately 2 percent of employers reported that they offered coverage for only mental health conditions in 2008 but not substance use disorders, and continued to offer coverage for only mental health conditions in the current plan year. Conversely, a small percentage of employers—about 2 percent of those employers that responded to our survey about their coverage of MH/SU for both plan years—reported discontinuing their coverage of both MH/SU or only substance use disorders in the current plan year. One employer that discontinued offering coverage of mental health reported that it did so to control health insurance costs. Another employer reported that it ceased to offer coverage of substance use disorders because it did not want to cover these disorders without treatment limitations. Under MHPAEA, if substance use disorders are covered, any treatment limitations for the substance use benefits must be used on par with those used in medical/surgical benefits. Published employer surveys also reported that few employers discontinued coverage of MH/SU since MHPAEA was passed. According to Kaiser/HRET’s Employer Health Benefits 2010 Annual Survey, less than 2 percent of employers reported eliminating coverage for MH/SU as a result of MHPAEA. Mercer reported in its National Survey of Employer-Sponsored Health Plans that the percentage of employers surveyed that reported offering coverage for MH/SU was consistent from 2008 to 2010. Specifically, about 90 percent of employers surveyed in 2008 and 92 percent of employers surveyed in 2010 reported offering coverage for MH/SU. According to both Mercer’s 2008 survey and 2010 survey, offering coverage of MH/SU was most common among employers with 500 or more employees, at about 97 percent. Additionally, about 90 percent of employers with fewer than 500 employees surveyed in 2008 and 92 percent of employers with fewer than 500 employees surveyed in 2010 indicated that they offered coverage for MH/SU. Agency officials also told us that based on their review of trend data and information on employer’s coverage of MH/SU, employers appeared to continue to offer coverage of MH/SU since MHPAEA was passed. In addition, representatives from large insurance companies, a health benefits consulting firm, and an MBHO told us that most employers with whom they interact continued to offer coverage of MH/SU since MHPAEA was passed. According to other health benefits experts, most employers they knew of generally experienced minimal challenges in complying with the MHPAEA requirements. Representatives from medium, large, and very large employers with whom we spoke told us that the process for making changes to their health plans to comply with MHPAEA was relatively easy for them because they relied on their insurance brokers or health benefits consultants to inform them of the requirements and assist them in making necessary changes. Employers have not substantially changed the diagnoses and treatments that are included in their MH/SU benefits.