Enforcement of the Federal Parity Law is handled by several different state and federal agencies. The primary source of enforcement are state insurance departments. Some states have additional departments responsible for enforcing the federal law, such as California’s Department of Managed Health Care (DMHC).

The federal agencies responsible for enforcing the Federal Parity Law are the Department of Labor (DOL), the Department of Health and Human Services (HHS), and the Department of the Treasury (DoT).

Action in the Regulatory Arena

2/2016

The Department of Health and Human Services Budget in Brief (pdf | Get Adobe® Reader®) contained two parity -related items:

10/2015

The Department of Labor (DOL) released a frequently-asked-questions (FAQ) regarding the Affordable Care Act and the Federal Parity Law. The section about the Federal Parity Law clarified the following about information they must disclose to enrollees, upon request:

6/2015

The Centers for Medicare and Medicaid Services (CMS) proposed a final rule on the federal law regarding Medicaid managed care organizations (MCOs), Medicaid alternative benefit plans (benchmark and benchmark equivalent plans), and the Children’s Health Insurance Program (CHIP). This rule proposes the following requirements:

  • Medicaid MCOs to meet parity requirements similarly to what is required of private plans in terms of treatment limitations and financial requirements.
  • Medicaid alternative benefit plans must comply with the parity requirements similarly to Medicaid MCOs.
  • Medicaid MCOs and Medicaid alternative benefit plans must make available upon request criteria for medical necessitydeterminations for behavioral health coverage.
  • Medicaid MCOs and Medicaid alternative benefit plans must make available the reason for any denial of coverage for behavioral health services.
  • CHIP plans that provide full coverage of Early and Periodic Screening, Diagnostic and Treatment (EPSDT) services will be meet parity requirements.
  • CHIP plans that do not provide full coverage of EPSDT will have to meet parity requirements similarly to private insurance plans.

Click here to read an in-depth analysis from the Legal Action Center.

11/2013

In November of 2013, DOL, HHS, and the DoT jointly issued the final rule (pdf | Get Adobe® Reader®) on the federal law. The final regulation took effect for plans that began after July 1, 2014. The final regulation incorporates much of what was included in the interim final rules (see below), and adds clarity and specificity to several areas within the law:

  • There are six classifications of insurance plan benefits: inpatientin-network ; outpatient in-network; inpatient out-of-network ; outpatient out-of-network; emergency services; and prescription medications. If a plan offers behavioral healthcoverage, it must offer the coverage in all of the same classifications for which it offers other medical coverage.
  • The final regulation provides guidance on non-quantitative treatment limitations (NQTLs) and specifies that any NQTLs used for behavioral health coverage must be comparable to and applied no more stringently than they are for other medical coverage. The final regulation also contains an extensive list of NQTLs, but does not contain any sort of mathematical compliance test for NQTLs.
  • Anything used by a plan to limit scope or duration of benefits is subject to the NQTL parity requirements.
  • Intermediate levels of care for both behavioral health services and other medical services must be identified by plans and have comparable coverage.
  • The regulation specifies that all cumulative financial requirements for behavioral health services must count towards the overall financial requirement of the insurance plan. For example, there cannot be a separate deductible for behavioral health coverage.

Previous to this proposed rule, CMS issued a State Health Official (pdf |Get Adobe® Reader®) letter in January of 2013 that offered guidance on the application of the Federal Parity Law for Medicaid MCOs, Medicaid alternative benefit plans, and CHIP plans. This letter contained guidance similar to what is offered in the proposed final rule.

2/2010

In February 2010, DOL, HHS, and the DoT jointly issued interim final rules (IFR) (pdf | Get Adobe® Reader®) for the Federal Parity Law, which took effect on July 1, 2010. These interim rules were incorporated into the final rule released in 2013 (see above)

11/2009

CMS issued another State Health Official (pdf | Get Adobe® Reader®) letter in November of 2009 regarding parity implications on the CHIP Reauthorization Act.

Federal Parity Law

The Federal Parity Law includes protections for insurance coverage of mental health conditions and substance use disorders. The Federal Parity Law does not require insurance plans to cover behavioral health treatment, but if they do cover behavioral health treatment, the coverage must be to equal to other medical coverage. The law forbids insurance plans from using quantitative treatment limitationsand financial requirements for behavioral health services that are less favorable than those in place for other medical services. Plans are forbidden from using non-quantitative treatment limitations (NQTLs)more restrictively for behavioral health services than how they are used for other medical services. Examples of NQTLs include prior authorization, step therapy, and various utilization reviewtechniques, among others.

The Federal Parity Law currently applies to most types of health insurance offered in the country. However, there are some notable exceptions, like Medicare, for example. Click here to see which plans are covered by the Federal Parity Law and which plans are not covered.

The Federal Parity Law sets the baseline for protection of parity rights when both the federal law and state parity laws apply to an insurance plan. If a plan is covered by the Federal Parity Law, people will get at least the level of rights afforded by the federal law. If a state law gives even more rights to the consumer, then it supersedes the federal law.

In 2013, Regulations were released that explain the scope of the Federal Parity Law in greater detail. Read more about these regulations here.