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From Health Law Daily, April 7, 2015

CMS Proposed rule would extend mental health parity to Medicaid MCOs

By Bryant Storm, J.D.

CMS issued an advance release of a Proposed rule applying provisions of the Mental Health Parity Act (MHPA) (P.L. 104-204) to Medicaid and the Children's Health Insurance Program (CHIP). The Proposed rule would ensure that Medicaid and CHIP beneficiaries would retain parity and access to mental health and substance use disorder benefits, regardless of the whether the services are provided through a Medicaid managed care organization (MCO) or another delivery method. Additionally, the Proposed rule, if made final, would guarantee parity between those who have coverage for mental health and substance use disorders in the commercial market and those who have coverage for those conditions through Medicaid or CHIP. The Proposed rule is set to be published in the Federal Register on April 10, 2015.

MHPA and ACA. The MHPA, among other requirements, provides that annual and lifetime dollar limits on mental health benefits in group health plans cannot be lower than dollar limits for traditional medical and surgical benefits. The parity requirements were further bolstered by an amendment to the MHPA, the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act (MHPAEA) (P.L. 110-343), and a Final Rule (78 FR 68240, November 13, 2013). The Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) extended the obligation even further by mandating that the parity requirements reach qualified health plans (QHPs) established by the ACA, and Medicaid non-managed care benchmark and benchmark equivalent plans (see Mental health coverage: is parity the point?, April 6, 2015).

MCOs and ABPs. The CMS Proposed rule will require states to include parity provisions in their contracts with MCOs. Specifically, the contractual requirements imposed on MCOs will be equivalent to those already imposed on private insurers. The Proposed rule leaves states with some flexibility by allowing them “to include the cost of providing additional services or removing treatment limitations in their capitation rate methodology.” The CMS proposal also would require states or plans to make medical necessity determination criteria available to beneficiaries on request. States would be obligated to make available to beneficiaries the reasons for “denial of reimbursement or payment for services with respect to mental health and substance use disorder benefits.” The parity requirements also extend to those states with Medicaid alternative benefit plans (ABPs). The Proposed rule treats ABPs in the same way that it treats MCOs.

CHIP. Under the Proposed rule, the CHIP program must satisfy all of the parity requirements imposed on the Medicaid program. The parity obligation exists whether services are provided through fee-for-service or managed care. The Proposed rule specifies that “CHIP state plans that provide full coverage of Early and Periodic Screening, Diagnostic and Treatment (EPSDT) services will be deemed in compliance with the parity requirements.” For those plans that do not provide EPSDT services, the parity requirements are identical to those that apply to health insurance issuers and group health plans.

CMS expressed its intention to allow states up to 18 months following publication of a final version of the Proposed rule before states would be expected to comply with the finalized parity requirements. Comments on the Proposed rule will be received for a sixty day period following its publication in the Federal Register.

MainStory: TopStory AgencyNews CMSNews ManagedCareNews MedicaidNews HealthReformNews QualityNews

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