The Mental Health Parity and Addiction Equity Act (MHPAEA)

What the parity law actually requires

MHPAEA passed in 2008. The Affordable Care Act in 2010 then extended its reach by making mental health and SUD treatment one of the ten Essential Health Benefits that ACA-compliant plans must cover. Together, these two laws cover most commercial insurance in the United States.

The parity requirement breaks into three categories. Financial requirements, your plan cannot apply higher copays, coinsurance, deductibles, or out-of-pocket maximums to mental health and SUD services than it applies to medical/surgical services. Quantitative treatment limits, your plan cannot apply stricter visit caps, day limits, or session limits to mental health and SUD treatment than to medical care. Non-quantitative treatment limits, the harder-to-pin-down stuff: prior authorization rules, medical necessity criteria, provider network adequacy, fail-first requirements. These must be applied no more strictly to mental health and SUD than to medical/surgical care.

The last category, non-quantitative limits, is where most parity violations happen. An insurer might cover SUD residential treatment on paper but require multiple failed outpatient attempts first, while not requiring the same for comparable medical conditions. That kind of asymmetry is what parity law prohibits.

What kinds of plans are covered

MHPAEA covers most commercial insurance, but not all. Coverage applies to:

• Most employer-sponsored group health plans (with 50+ employees historically; ACA expanded smaller plans)
• Individual and small-group health plans sold through the ACA marketplaces
• Medicaid managed-care plans in most states, including NJ FamilyCare and NC Medicaid managed-care
• Children's Health Insurance Program (CHIP) plans
• Federal employee health benefit plans (FEHB)
• Most state and local government plans that have opted in

What is not covered by parity

• Self-funded plans from very small employers (rare; most have voluntarily opted in)
• Traditional Medicare has its own coverage rules, not technically subject to MHPAEA but provides substantial SUD/MH coverage through Parts A, B, and D
• Some grandfathered plans that have not been substantially modified since 2010
• Short-term limited-duration health plans (the "junk insurance" plans that emerged in 2018) often exclude mental health and SUD entirely, verify before purchasing

What treatments must be covered

MHPAEA does not specify which treatments must be covered. It specifies that whatever is covered must be covered at parity with medical care. In practice, ACA-compliant plans cover the standard SUD continuum:

• Inpatient detoxification, medical detox, usually 3 to 10 days depending on substance
• Inpatient or residential rehabilitation, 24-hour residential care, 28 to 90 day stays common
• Partial Hospitalization (PHP), full-day outpatient, 5 to 6 days a week, typically 2 to 4 weeks
• Intensive Outpatient (IOP), 9+ hours per week of group therapy, 4 to 12 weeks typical
• Outpatient (OP), individual therapy and continuing care, open-ended
• Medication-assisted treatment (MAT), Suboxone, Vivitrol, Sublocade, methadone (the latter through opioid treatment programs)
• Mental health services, psychotherapy, psychiatric medication management, intensive psychiatric programs
• Crisis services, crisis hotlines, mobile crisis teams, emergency department care

Common parity violations to watch for

If you see any of these patterns in your plan or in how it processes your claims, the plan may be violating parity. None of these are conclusive by themselves, the standard is whether the same restrictions apply to comparable medical conditions, but each is worth scrutiny:

• Higher prior authorization burden for SUD/MH than for similar medical conditions
• Day limits on residential SUD treatment that are not matched by limits on similar medical conditions (e.g., post-surgical rehab)
• "Fail first" requirements, having to try outpatient before residential is approved, when similar medical conditions do not have analogous requirements
• Mandatory frequent reauthorization during a course of treatment that is not required for similar medical treatment
• Higher copays or coinsurance for mental health/SUD provider visits compared to medical specialty visits
• Provider network gaps, having too few in-network mental health/SUD providers in your area to meet demand, when the medical specialist network is adequate
• Denials based on "medical necessity" criteria that are stricter than those used for medical care

How to file a parity appeal

If your plan denies SUD or mental health treatment that you believe should be covered under parity, you have appeal rights, both internal (to the insurer) and external (to a state or federal regulator).

Internal appeal

Every commercial plan must offer an internal appeal process. Steps: (1) request a written copy of the denial with the specific reason. (2) request a copy of the medical necessity criteria the insurer used. (3) request a copy of the criteria used for comparable medical/surgical services. (4) compare the two, if the SUD/MH standard is stricter, you have a parity argument. (5) submit a written appeal within the timeline specified in the denial letter (usually 60 to 180 days).

Many parity denials are reversed at internal appeal. The treatment center's clinical team can help, they regularly write appeal letters and have templates that incorporate ASAM Criteria and MHPAEA language.

External appeal

If internal appeal fails, you can request external review by an independent medical reviewer. The exact process varies by state and plan type. ACA-compliant plans must offer external review; the timelines and process are specified in your plan documents.

Regulatory complaints

Department of Labor handles parity complaints for employer-sponsored plans (ERISA plans). File at askEBSA.dol.gov or call 1-866-444-3272.

Department of Health and Human Services handles parity complaints for ACA marketplace plans and some others. File at cms.gov.

State insurance commissioner handles parity for state-regulated plans. Both NJ and NC have insurance commissioners who accept parity complaints.

What the parity law does not do

Parity law is powerful but limited. It does not:

• Require any plan to offer mental health or SUD coverage. It only requires parity for plans that do offer it. (ACA, separately, makes it a required benefit for ACA-compliant plans.)
• Set specific coverage levels. It requires equity with medical care, but the medical baseline itself may be limited.
• Override medical necessity standards. Insurers can still deny coverage they believe is not medically necessary; parity requires only that the medical necessity standard be the same for SUD/MH as for medical.
• Cover out-of-network providers automatically. Provider network rules apply; parity requires that the network be adequate, not that all providers be in-network.
• Apply to short-term limited-duration plans. These plans, expanded in 2018, often exclude mental health and SUD entirely. Verify coverage before purchasing.

What to do if you suspect a parity violation

Three parallel steps:

• Engage treatment center's appeal process. The Archangel Centers admissions team is experienced with parity appeals and works with the medical and clinical leadership to draft appeals where appropriate.
• File a regulatory complaint with the Department of Labor (employer plans), CMS (ACA marketplace), or your state insurance commissioner (other plans). Complaints help establish patterns even if they do not directly help your case.
• Consider a healthcare attorney for complex cases, particularly if you have been denied a residential or longer-term treatment level. Many attorneys handle parity cases on contingency.