In the SPOTLIGHT

Ten Years Later, Abysmal Enforcement of Mental Health Parity Laws

By: April Banerjee, PWDF Executive Director, and Steven Bruce, PWDF Legal Director

I. INTRODUCTION

Treatment limitations may be quantitative, for example, a limit of two visits, or non-quantitative, which otherwise limit the scope or duration of benefits for treatment under a plan or coverage.[⁷]  Examples of nonquantitative treatment limitations include medical management standards limiting or excluding benefits based on medical necessity or medical appropriateness, or based on whether the treatment is experimental or investigative; formulary design for prescription drugs; standards for provider admission to participate in a network, including reimbursement rates; and plan methods for determining usual, customary and reasonable charges.[⁸]  A permanent exclusion of all benefits for a particular condition or disorder, however, is not a treatment limitation for purposes of this definition.[⁹]

This year, 10 years after passage of the MPHAEA and as required by the 21st Century Cures Act, HHS produced an “action plan” intended to address reporting and enforcement, disclosure and transparency, consumer and compliance tools, technical assistance to the states, and research. Highlights of planned actions by various federal agencies are that the DOL will annually publish fact sheets with summaries of MHPAEA enforcement investigations in the prior fiscal year and HHS’s Centers for Medicare and Medicaid Services (CMS) will continue to publish information about its enforcement investigations of non-federal government plans.[¹⁰]

We agree that consumer education and the creation of tools such as standardized forms are important; however, much stronger administrative enforcement is also important since individual consumers cannot afford to go into federal court to seek parity in health care.

HHS Enforcement

HHS has authority to enforce the law against insurance companies. HHS/Centers for Medicare and Medicaid Services (CMS) also has primary enforcement authority of the MHPAEA for insured and self-funded non-federal governmental employee group health plans, i.e., those sponsored by states, counties, school districts, and municipalities  and over health insurance issuers in the individual and fully-insured group markets when a state elects not to enforce the MHPAEA or fails to substantially enforce it. As of December 2017, this was four states.[¹¹]

HHS/CMS has only completed six MHPAEA investigations in the last two years (2016 and 2017).[¹²]  These investigations comprised five non-federal governmental plan investigations plus one market conduct examination, the process by which CMS audits health insurance issuers in states where CMS is directly enforcing MHPAEA for compliance. (CMS also has the authority to initiate market conduct examinations for non-federal governmental plans).[¹³]  Notably, in the “Reporting and Enforcement” section of its 2018 Action Plan, it only states that it will continue to publish information on its enforcement activities; it neglects to make concrete commitments to increasing its investigations and market conduct examinations, a glaring omission.[¹⁴]

DOL Enforcement

The DOL oversees most employer-sponsored group health plans,[¹⁵] with DOL’s Employee Benefits Security Administration (EBSA) responsible for MHPAEA enforcement. DOL’s 2018 report to Congress says that EBSA has approximately 400 investigators and 100 benefits advisors to oversee over 5 million health, pension, and other employee benefit plans, which “equates to less than one investigator for every 12,500 plans.[¹⁶]  A comparison of EBSA’s FY 2016 and 2017 Fact Sheets indicates that EBSA had 13% fewer investigators in FY 2017 than in FY 2016.[¹⁷]

In FY 2017, EBSA closed 347 investigations, of which 187 involved plans subject to MHPAEA and cited 92 violations for MHPAEA noncompliance.[¹⁸]  In FY 2016, EBSA cited 44 violations for MHPAEA noncompliance.[¹⁹]  It is notable that these 136 violations over the last two fiscal years approach half of the over 300 violations of MHPAEA that DOL has cited since 2010.[²⁰]

DOL generally only has jurisdiction to require group health plans to provide reimbursement to plan participants and beneficiaries whose claims were improperly denied and/or to provide coverage.  “The sole means of enforcement under the parity act is equitable relief for the buyer of the insurance plan; and for the employee-based plans that are self-funding, DOL is presently permitted to enforce MHPAEA against only the employer . . . .”[²¹.]]

Lack of Access to Services

A 2016 federal task force on mental health and substance use disorder parity (“2016 Task Force”) noted a lack of access to behavioral health services was a significant issue. This was attributed to provider workforce shortages and lack of providers in insurance networks. The latter is often because providers may receive a lower reimbursement rate from the health plan network than they would from cash-paying clients.[²²]  The DOL describes provider reimbursement rates as an issue of concern voiced by stakeholders.[²³]  Clearly, these are parity issues. The issue here is the same as in civil rights discrimination — there must be equal opportunity, often defined as having meaningful access, to mental health care, i.e., the same access as there is to physical health care.

For example, a 2017 settlement between the California Department of Managed Health Care and Kaiser Permanente highlights the typical concerns when large scale providers neglect to provide services to mental health patients in a timely matter. Within these negotiations, there is acknowledgment of the progress that has not been made. Kaiser asserts that “Recruiting highly qualified therapists, psychiatrists and other mental health clinicians is challenging for all health care systems, including Kaiser Permanente, due to a national shortage of these skilled caregivers.”[²⁴] In a recent 5-year period, Kaiser Permanente hired only 850 new behavioral health therapists and 188 behavioral health physicians.[²⁵] Given Kaiser’s vast footprint (over 8,624,000 enrollees in CA) [²⁶] these are not large numbers in terms of providing mental health care services.

In acknowledging these deficiencies, Kaiser agreed to a corrective action plan to fix access, availability and continuity of care for mental health patients as outlined in their settlement of July 18, 2017.[²⁷] The other 49 states have their own counterparts.

PWDF believes HHS and DOL should be required to investigate health insurers and levy civil penalties for violations in conjunction with other mechanisms resulting in parity act violations, including, but not limited to, underfunding mental health care professions, limiting the number of visits to psychotherapists and/or psychiatrist and psychologists, or having other barriers to equal access to mental health care.  While the 21^st Century Cures Act, enacted in 2016, requires DOL, HHS, and Treasury to audit plan documents for group health plans or health insurance issuers under their respective enforcement authority if the plan or issuer has violated parity act requirements at least five times,[³⁰] this is too lax: these agencies should all be required to conduct comprehensive compliance reviews on their own initiative, i.e., without only relying on consumer complaints, as has been done for civil rights violations of the Civil Rights Act of 1964, Section 504 of the Rehabilitation Act of 1973, and the Americans with Disabilities Act of 1990, as amended.

These comprehensive compliance reviews for parity act violations should be integrated with other HHS, DOL, and Treasury offices that enforce civil rights.  For example, we note that HHS Office for Civil Rights (OCR) has been given exclusive jurisdiction for Health Insurance Portability and Accountability Act of 1996 (HIPAA) compliance enforcement.  Combining MHPAEA and HIPAA reviews will be more economically efficient, saving federal agency resources.  These comprehensive compliance reviews should be based on a combination of factors, such as the size of the organization, number of beneficiaries, number of complaints, rural or urban, etc.

The enforcing agencies should also be required to conduct such examinations after two serious violations discovered through complaints from consumers, state agencies, or other sources, rather than waiting until five violations because at that point many people may have experienced more serious barriers to accessing mental health services.  Additionally, HHS should be required to make meaningful commitments to enforcement investigations and comprehensive compliance reviews.  PWDF is cognizant that these kind of investigations change under Republican vs. Democrat administrations; however, the implementing regulations should require parity at the earliest opportunity.

PWDF is planning to submit Freedom of Information Act requests to HHS and DOL to obtain information about their (lack of) complaint and compliance enforcement actions and will provide information when received.

III. CONCLUSION

Who We Are

People With Disabilities Foundation is an operating 501(c)(3) nonprofit organization based in San Francisco, California, which focuses on the rights of the mentally and developmentally disabled.

Services

Advocacy: PWDF advocates for Social Security claimant’s disability benefits in eight Bay Area counties. We also provide services in disability rights, on issues regarding returning to work, and in ADA consultations, including areas of employment, health care, and education, among others. There is representation before all levels of federal court and Administrative Law Judges. No one is declined due to their inability to pay, and we offer a sliding scale for attorney’s fees.

Education/Public Awareness: To help eliminate the stigma against people with mental disabilities in society, PWDF’s educational program organizes workshops and public seminars, provides guest speakers with backgrounds in mental health, and produces educational materials such as videos.

Continuing Education Provider: State Bar of California MCLE and Commission of Rehabilitation Counselor Certification.