[House Report 116-692]
[From the U.S. Government Publishing Office]
116th Congress } { Rept. 116-692
HOUSE OF REPRESENTATIVES
2d Session } { Part 1
========================================================================
STRENGTHENING BEHAVIORAL HEALTH PARITY ACT
_______
December 24, 2020.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Mr. Pallone, from the Committee on Energy and Commerce, submitted the
following
R E P O R T
[To accompany H.R. 7539]
The Committee on Energy and Commerce, to whom was referred
the bill (H.R. 7539) to strengthen parity in mental health and
substance use disorder benefits, having considered the same,
reports favorably thereon with an amendment and recommends that
the bill as amended do pass.
CONTENTS
Page
I. Purpose and Summary............................................19
II. Background and Need for the Legislation........................19
III. Committee Hearings.............................................20
IV. Committee Consideration........................................21
V. Committee Votes................................................21
VI. Oversight Findings.............................................21
VII. New Budget Authority, Entitlement Authority, and Tax Expenditur21
VIII. Federal Mandates Statement.....................................22
IX. Exchange of Letters............................................23
X. Statement of General Performance Goals and Objectives..........27
XI. Duplication of Federal Programs................................27
XII. Committee Cost Estimate........................................27
XIII. Earmarks, Limited Tax Benefits, and Limited Tariff Benefits....27
XIV. Advisory Committee Statement...................................27
XV. Applicability to Legislative Branch............................27
XVI. Section-by-Section Analysis of the Legislation.................27
XVII. Changes in Existing Law Made by the Bill, as Reported..........28
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Strengthening Behavioral Health Parity
Act''.
SEC. 2. STRENGTHENING PARITY IN MENTAL HEALTH AND SUBSTANCE USE
DISORDER BENEFITS.
(a) PHSA.--
(1) In general.--Title XXVII of the Public Health Service Act
(42 U.S.C. 300gg-11 et seq.) is amended by adding at the end
the following new part:
``PART D--ADDITIONAL COVERAGE PROVISIONS
``SEC. 2799A-1. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DISORDER
BENEFITS.
``(a) In General.--
``(1) Aggregate lifetime limits.--In the case of a group
health plan or a health insurance issuer offering group or
individual health insurance coverage that provides both medical
and surgical benefits and mental health or substance use
disorder benefits--
``(A) No lifetime limit.--If the plan or coverage
does not include an aggregate lifetime limit on
substantially all medical and surgical benefits, the
plan or coverage may not impose any aggregate lifetime
limit on mental health or substance use disorder
benefits.
``(B) Lifetime limit.--If the plan or coverage
includes an aggregate lifetime limit on substantially
all medical and surgical benefits (in this paragraph
referred to as the `applicable lifetime limit'), the
plan or coverage shall either--
``(i) apply the applicable lifetime limit
both to the medical and surgical benefits to
which it otherwise would apply and to mental
health and substance use disorder benefits and
not distinguish in the application of such
limit between such medical and surgical
benefits and mental health and substance use
disorder benefits; or
``(ii) not include any aggregate lifetime
limit on mental health or substance use
disorder benefits that is less than the
applicable lifetime limit.
``(C) Rule in case of different limits.--In the case
of a plan or coverage that is not described in
subparagraph (A) or (B) and that includes no or
different aggregate lifetime limits on different
categories of medical and surgical benefits, the
Secretary shall establish rules under which
subparagraph (B) is applied to such plan or coverage
with respect to mental health and substance use
disorder benefits by substituting for the applicable
lifetime limit an average aggregate lifetime limit that
is computed taking into account the weighted average of
the aggregate lifetime limits applicable to such
categories.
``(2) Annual limits.--In the case of a group health plan or a
health insurance issuer offering group or individual health
insurance coverage that provides both medical and surgical
benefits and mental health or substance use disorder benefits--
``(A) No annual limit.--If the plan or coverage does
not include an annual limit on substantially all
medical and surgical benefits, the plan or coverage may
not impose any annual limit on mental health or
substance use disorder benefits.
``(B) Annual limit.--If the plan or coverage includes
an annual limit on substantially all medical and
surgical benefits (in this paragraph referred to as the
`applicable annual limit'), the plan or coverage shall
either--
``(i) apply the applicable annual limit both
to medical and surgical benefits to which it
otherwise would apply and to mental health and
substance use disorder benefits and not
distinguish in the application of such limit
between such medical and surgical benefits and
mental health and substance use disorder
benefits; or
``(ii) not include any annual limit on mental
health or substance use disorder benefits that
is less than the applicable annual limit.
``(C) Rule in case of different limits.--In the case
of a plan or coverage that is not described in
subparagraph (A) or (B) and that includes no or
different annual limits on different categories of
medical and surgical benefits, the Secretary shall
establish rules under which subparagraph (B) is applied
to such plan or coverage with respect to mental health
and substance use disorder benefits by substituting for
the applicable annual limit an average annual limit
that is computed taking into account the weighted
average of the annual limits applicable to such
categories.
``(3) Financial requirements and treatment limitations.--
``(A) In general.--In the case of a group health plan
or a health insurance issuer offering group or
individual health insurance coverage that provides both
medical and surgical benefits and mental health or
substance use disorder benefits, such plan or coverage
shall ensure that--
``(i) the financial requirements applicable
to such mental health or substance use disorder
benefits are no more restrictive than the
predominant financial requirements applied to
substantially all medical and surgical benefits
covered by the plan (or coverage), and there
are no separate cost sharing requirements that
are applicable only with respect to mental
health or substance use disorder benefits; and
``(ii) the treatment limitations applicable
to such mental health or substance use disorder
benefits are no more restrictive than the
predominant treatment limitations applied to
substantially all medical and surgical benefits
covered by the plan (or coverage) and there are
no separate treatment limitations that are
applicable only with respect to mental health
or substance use disorder benefits.
``(B) Definitions.--In this paragraph:
``(i) Financial requirement.--The term
`financial requirement' includes deductibles,
copayments, coinsurance, and out-of-pocket
expenses, but excludes an aggregate lifetime
limit and an annual limit subject to paragraphs
(1) and (2).
``(ii) Predominant.--A financial requirement
or treatment limit is considered to be
predominant if it is the most common or
frequent of such type of limit or requirement.
``(iii) Treatment limitation.--The term
`treatment limitation' includes limits on the
frequency of treatment, number of visits, days
of coverage, or other similar limits on the
scope or duration of treatment.
``(4) Availability of plan information.--The criteria for
medical necessity determinations made under the plan with
respect to mental health or substance use disorder benefits (or
the health insurance coverage offered in connection with the
plan with respect to such benefits) shall be made available by
the plan administrator (or the health insurance issuer offering
such coverage) in accordance with regulations to any current or
potential participant, beneficiary, or contracting provider
upon request. The reason for any denial under the plan (or
coverage) of reimbursement or payment for services with respect
to mental health or substance use disorder benefits in the case
of any participant or beneficiary shall, on request or as
otherwise required, be made available by the plan administrator
(or the health insurance issuer offering such coverage) to the
participant or beneficiary in accordance with regulations.
``(5) Out-of-network providers.--In the case of a plan or
coverage that provides both medical and surgical benefits and
mental health or substance use disorder benefits, if the plan
or coverage provides coverage for medical or surgical benefits
provided by out-of-network providers, the plan or coverage
shall provide coverage for mental health or substance use
disorder benefits provided by out-of-network providers in a
manner that is consistent with the requirements of this
section.
``(6) Compliance program guidance document.--
``(A) In general.--Not later than 12 months after the
date of enactment of the Helping Families in Mental
Health Crisis Reform Act of 2016, the Secretary, the
Secretary of Labor, and the Secretary of the Treasury,
in consultation with the Inspector General of the
Department of Health and Human Services, the Inspector
General of the Department of Labor, and the Inspector
General of the Department of the Treasury, shall issue
a compliance program guidance document to help improve
compliance with this section, section 712 of the
Employee Retirement Income Security Act of 1974, and
section 9812 of the Internal Revenue Code of 1986, as
applicable. In carrying out this paragraph, the
Secretaries may take into consideration the 2016
publication of the Department of Health and Human
Services and the Department of Labor, entitled `Warning
Signs - Plan or Policy Non-Quantitative Treatment
Limitations (NQTLs) that Require Additional Analysis to
Determine Mental Health Parity Compliance'.
``(B) Examples illustrating compliance and
noncompliance.--
``(i) In general.--The compliance program
guidance document required under this paragraph
shall provide illustrative, de-identified
examples (that do not disclose any protected
health information or individually identifiable
information) of previous findings of compliance
and noncompliance with this section, section
712 of the Employee Retirement Income Security
Act of 1974, or section 9812 of the Internal
Revenue Code of 1986, as applicable, based on
investigations of violations of such sections,
including--
``(I) examples illustrating
requirements for information
disclosures and nonquantitative
treatment limitations; and
``(II) descriptions of the violations
uncovered during the course of such
investigations.
``(ii) Nonquantitative treatment
limitations.--To the extent that any example
described in clause (i) involves a finding of
compliance or noncompliance with regard to any
requirement for nonquantitative treatment
limitations, the example shall provide
sufficient detail to fully explain such
finding, including a full description of the
criteria involved for approving medical and
surgical benefits and the criteria involved for
approving mental health and substance use
disorder benefits.
``(iii) Access to additional information
regarding compliance.--In developing and
issuing the compliance program guidance
document required under this paragraph, the
Secretaries specified in subparagraph (A)--
``(I) shall enter into interagency
agreements with the Inspector General
of the Department of Health and Human
Services, the Inspector General of the
Department of Labor, and the Inspector
General of the Department of the
Treasury to share findings of
compliance and noncompliance with this
section, section 712 of the Employee
Retirement Income Security Act of 1974,
or section 9812 of the Internal Revenue
Code of 1986, as applicable; and
``(II) shall seek to enter into an
agreement with a State to share
information on findings of compliance
and noncompliance with this section,
section 712 of the Employee Retirement
Income Security Act of 1974, or section
9812 of the Internal Revenue Code of
1986, as applicable.
``(C) Recommendations.--The compliance program
guidance document shall include recommendations to
advance compliance with this section, section 712 of
the Employee Retirement Income Security Act of 1974, or
section 9812 of the Internal Revenue Code of 1986, as
applicable, and encourage the development and use of
internal controls to monitor adherence to applicable
statutes, regulations, and program requirements. Such
internal controls may include illustrative examples of
nonquantitative treatment limitations on mental health
and substance use disorder benefits, which may fail to
comply with this section, section 712 of the Employee
Retirement Income Security Act of 1974, or section 9812
of the Internal Revenue Code of 1986, as applicable, in
relation to nonquantitative treatment limitations on
medical and surgical benefits.
``(D) Updating the compliance program guidance
document.--The Secretary, the Secretary of Labor, and
the Secretary of the Treasury, in consultation with the
Inspector General of the Department of Health and Human
Services, the Inspector General of the Department of
Labor, and the Inspector General of the Department of
the Treasury, shall update the compliance program
guidance document every 2 years to include
illustrative, de-identified examples (that do not
disclose any protected health information or
individually identifiable information) of previous
findings of compliance and noncompliance with this
section, section 712 of the Employee Retirement Income
Security Act of 1974, or section 9812 of the Internal
Revenue Code of 1986, as applicable.
``(7) Additional guidance.--
``(A) In general.--Not later than 12 months after the
date of enactment of the Helping Families in Mental
Health Crisis Reform Act of 2016, the Secretary, the
Secretary of Labor, and the Secretary of the Treasury
shall issue guidance to group health plans and health
insurance issuers offering group or individual health
insurance coverage to assist such plans and issuers in
satisfying the requirements of this section, section
712 of the Employee Retirement Income Security Act of
1974, or section 9812 of the Internal Revenue Code of
1986, as applicable.
``(B) Disclosure.--
``(i) Guidance for plans and issuers.--The
guidance issued under this paragraph shall
include clarifying information and illustrative
examples of methods that group health plans and
health insurance issuers offering group or
individual health insurance coverage may use
for disclosing information to ensure compliance
with the requirements under this section,
section 712 of the Employee Retirement Income
Security Act of 1974, or section 9812 of the
Internal Revenue Code of 1986, as applicable,
(and any regulations promulgated pursuant to
such sections, as applicable).
``(ii) Documents for participants,
beneficiaries, contracting providers, or
authorized representatives.--The guidance
issued under this paragraph shall include
clarifying information and illustrative
examples of methods that group health plans and
health insurance issuers offering group or
individual health insurance coverage may use to
provide any participant, beneficiary,
contracting provider, or authorized
representative, as applicable, with documents
containing information that the health plans or
issuers are required to disclose to
participants, beneficiaries, contracting
providers, or authorized representatives to
ensure compliance with this section, section
712 of the Employee Retirement Income Security
Act of 1974, or section 9812 of the Internal
Revenue Code of 1986, as applicable, compliance
with any regulation issued pursuant to such
respective section, or compliance with any
other applicable law or regulation. Such
guidance shall include information that is
comparative in nature with respect to--
``(I) nonquantitative treatment
limitations for both medical and
surgical benefits and mental health and
substance use disorder benefits;
``(II) the processes, strategies,
evidentiary standards, and other
factors used to apply the limitations
described in subclause (I); and
``(III) the application of the
limitations described in subclause (I)
to ensure that such limitations are
applied in parity with respect to both
medical and surgical benefits and
mental health and substance use
disorder benefits.
``(C) Nonquantitative treatment limitations.--The
guidance issued under this paragraph shall include
clarifying information and illustrative examples of
methods, processes, strategies, evidentiary standards,
and other factors that group health plans and health
insurance issuers offering group or individual health
insurance coverage may use regarding the development
and application of nonquantitative treatment
limitations to ensure compliance with this section,
section 712 of the Employee Retirement Income Security
Act of 1974, or section 9812 of the Internal Revenue
Code of 1986, as applicable, (and any regulations
promulgated pursuant to such respective section),
including--
``(i) examples of methods of determining
appropriate types of nonquantitative treatment
limitations with respect to both medical and
surgical benefits and mental health and
substance use disorder benefits, including
nonquantitative treatment limitations
pertaining to--
``(I) medical management standards
based on medical necessity or
appropriateness, or whether a treatment
is experimental or investigative;
``(II) limitations with respect to
prescription drug formulary design; and
``(III) use of fail-first or step
therapy protocols;
``(ii) examples of methods of determining--
``(I) network admission standards
(such as credentialing); and
``(II) factors used in provider
reimbursement methodologies (such as
service type, geographic market, demand
for services, and provider supply,
practice size, training, experience,
and licensure) as such factors apply to
network adequacy;
``(iii) examples of sources of information
that may serve as evidentiary standards for the
purposes of making determinations regarding the
development and application of nonquantitative
treatment limitations;
``(iv) examples of specific factors, and the
evidentiary standards used to evaluate such
factors, used by such plans or issuers in
performing a nonquantitative treatment
limitation analysis;
``(v) examples of how specific evidentiary
standards may be used to determine whether
treatments are considered experimental or
investigative;
``(vi) examples of how specific evidentiary
standards may be applied to each service
category or classification of benefits;
``(vii) examples of methods of reaching
appropriate coverage determinations for new
mental health or substance use disorder
treatments, such as evidence-based early
intervention programs for individuals with a
serious mental illness and types of medical
management techniques;
``(viii) examples of methods of reaching
appropriate coverage determinations for which
there is an indirect relationship between the
covered mental health or substance use disorder
benefit and a traditional covered medical and
surgical benefit, such as residential treatment
or hospitalizations involving voluntary or
involuntary commitment; and
``(ix) additional illustrative examples of
methods, processes, strategies, evidentiary
standards, and other factors for which the
Secretary determines that additional guidance
is necessary to improve compliance with this
section, section 712 of the Employee Retirement
Income Security Act of 1974, or section 9812 of
the Internal Revenue Code of 1986, as
applicable.
``(D) Public comment.--Prior to issuing any final
guidance under this paragraph, the Secretary shall
provide a public comment period of not less than 60
days during which any member of the public may provide
comments on a draft of the guidance.
``(8) Compliance requirements.--
``(A) Nonquantitative treatment limitation (nqtl)
requirements.--In the case of a group health plan or a
health insurance issuer offering group or individual
health insurance coverage that provides both medical
and surgical benefits and mental health or substance
use disorder benefits and that imposes nonquantitative
treatment limitations (referred to in this section as
`NQTL') on mental health or substance use disorder
benefits, the plan or issuer offering health insurance
coverage shall perform comparative analyses of the
design and application of NQTLs in accordance with
subparagraph (B), and, beginning 45 days after the date
of enactment of this paragraph, make available to the
applicable State authority (or, as applicable, the
Secretary), upon request, the comparative analyses and
the following information:
``(i) The specific plan or coverage terms
regarding the NQTL, that applies to such plan
or coverage, and a description of all mental
health or substance use disorder and medical or
surgical benefits to which it applies in each
respective benefits classification.
``(ii) The factors used to determine that the
NQTL will apply to mental health or substance
use disorder benefits and medical or surgical
benefits.
``(iii) The evidentiary standards used for
the factors identified in clause (ii), when
applicable, provided that every factor shall be
defined and any other source or evidence relied
upon to design and apply the NQTL to mental
health or substance use disorder benefits and
medical or surgical benefits.
``(iv) The comparative analyses demonstrating
that the processes, strategies, evidentiary
standards, and other factors used to design the
NQTL, as written, and the operation processes
and strategies as written and in operation that
are used to apply the NQTL for mental health or
substance use disorder benefits are comparable
to, and are applied no more stringently than,
the processes, strategies, evidentiary
standards, and other factors used to design the
NQTL, as written, and the operation processes
and strategies as written and in operation that
are used to apply the NQTL to medical or
surgical benefits.
``(v) A disclosure of the specific findings
and conclusions reached by the plan or coverage
that the results of the analyses described in
this subparagraph indicate that the plan or
coverage is in compliance with this section.
``(B) Secretary request process.--
``(i) Submission upon request.--The Secretary
shall request that a group health plan or a
health insurance issuer offering group or
individual health insurance coverage submit the
comparative analyses described in subparagraph
(A) for plans that involve potential violations
of this section or complaints regarding
noncompliance with this section that concern
NQTLs and any other instances in which the
Secretary determines appropriate. The Secretary
shall request not fewer than 20 such analyses
per year.
``(ii) Additional information.--In instances
in which the Secretary has concluded that the
plan or coverage has not submitted sufficient
information for the Secretary to review the
comparative analyses described in subparagraph
(A), as requested under clause (i), the
Secretary shall specify to the plan or coverage
the information the plan or coverage must
submit to be responsive to the request under
clause (i) for the Secretary to review the
comparative analyses described in
subparagraph(A) for compliance with this
section. Nothing in this paragraph shall
require the Secretary to conclude that a plan
is in compliance with this section solely based
upon the inspection of the comparative analyses
described in subparagraph (A), as requested
under clause (i).
``(iii) Required action.--
``(I) In general.--In instances in
which the Secretary has reviewed the
comparative analyses described in
subparagraph (A), as requested under
clause (i), and determined that the
plan or coverage is not in compliance
with this section, the plan or
coverage--
``(aa) shall specify to the
Secretary the actions the plan
or coverage will take to be in
compliance with this section
and provide to the Secretary
comparative analyses described
in subparagraph (A) that
demonstrate compliance with
this section not later than 45
days after the initial
determination by the Secretary
that the plan or coverage is
not in compliance; and
``(bb) following the 45-day
corrective action period under
item (aa), if the Secretary
determines that the plan or
coverage still is not in
compliance with this section,
not later than 7 days after
such determination, shall
notify all individuals enrolled
in the plan or coverage that
the plan or coverage has been
determined to be not in
compliance with this section.
``(II) Exemption from disclosure.--
Documents or communications produced in
connection with the Secretary's
recommendations to the plan or coverage
shall not be subject to disclosure
pursuant to section 552 of title 5,
United States Code.
``(iv) Report.--Not later than 1 year after
the date of enactment of this paragraph, and
not later than October 1 of each year
thereafter, the Secretary shall submit to
Congress, and make publicly available, a report
that contains--
``(I) a summary of the comparative
analyses requested under clause (i),
including the identity of each plan or
coverage that is determined to be not
in compliance after the final
determination by the Secretary
described in clause (iii)(I)(bb);
``(II) the Secretary's conclusions as
to whether each plan or coverage
submitted sufficient information for
the Secretary to review the comparative
analyses requested under clause (i) for
compliance with this section;
``(III) for each plan or coverage
that did submit sufficient information
for the Secretary to review the
comparative analyses requested under
clause (i), the Secretary's conclusions
as to whether and why the plan or
coverage is in compliance with the
requirements under this section;
``(IV) the Secretary's specifications
described in clause (ii) for each plan
or coverage that the Secretary
determined did not submit sufficient
information for the Secretary to review
the comparative analyses requested
under clause (i) for compliance with
this section; and
``(V) the Secretary's specifications
described in clause (iii) of the
actions each plan or coverage that the
Secretary determined is not in
compliance with this section must take
to be in compliance with this section,
including the reason why the Secretary
determined the plan or coverage is not
in compliance.
``(C) Compliance program guidance document update
process.--
``(i) In general.--The Secretary shall
include instances of noncompliance that the
Secretary discovers upon reviewing the
comparative analyses requested under
subparagraph (B)(i) in the compliance program
guidance document described in paragraph (6),
as it is updated every 2 years, except that
such instances shall not disclose any protected
health information or individually identifiable
information.
``(ii) Guidance and regulations.--Not later
than 18 months after the date of enactment of
this paragraph, the Secretary shall finalize
any draft or interim guidance and regulations
relating to mental health parity under this
section. Such draft guidance shall include
guidance to clarify the process and timeline
for current and potential participants and
beneficiaries (and authorized representatives
and health care providers of such participants
and beneficiaries) with respect to plans to
file complaints of such plans or issuers being
in violation of this section, including
guidance, by plan type, on the relevant State,
regional, or national office with which such
complaints should be filed.
``(iii) State.--The Secretary shall share
information on findings of compliance and
noncompliance discovered upon reviewing the
comparative analyses requested under
subparagraph (B)(i) with the State where the
group health plan is located or the State where
the health insurance issuer is licensed to do
business for coverage offered by a health
insurance issuer in the group market, in
accordance with paragraph (6)(B)(iii)(II).
``(b) Construction.--Nothing in this section shall be construed--
``(1) as requiring a group health plan or a health insurance
issuer offering group or individual health insurance coverage
to provide any mental health or substance use disorder
benefits; or
``(2) in the case of a group health plan or a health
insurance issuer offering group or individual health insurance
coverage that provides mental health or substance use disorder
benefits, as affecting the terms and conditions of the plan or
coverage relating to such benefits under the plan or coverage,
except as provided in subsection (a).
``(c) Exemptions.--
``(1) Small employer exemption.--This section shall not apply
to any group health plan and a health insurance issuer offering
group or individual health insurance coverage for any plan year
of a small employer (as defined in section 2791(e)(4), except
that for purposes of this paragraph such term shall include
employers with 1 employee in the case of an employer residing
in a State that permits small groups to include a single
individual).
``(2) Cost exemption.--
``(A) In general.--With respect to a group health
plan or a health insurance issuer offering group or
individual health insurance coverage, if the
application of this section to such plan (or coverage)
results in an increase for the plan year involved of
the actual total costs of coverage with respect to
medical and surgical benefits and mental health and
substance use disorder benefits under the plan (as
determined and certified under subparagraph (C)) by an
amount that exceeds the applicable percentage described
in subparagraph (B) of the actual total plan costs, the
provisions of this section shall not apply to such plan
(or coverage) during the following plan year, and such
exemption shall apply to the plan (or coverage) for 1
plan year. An employer may elect to continue to apply
mental health and substance use disorder parity
pursuant to this section with respect to the group
health plan (or coverage) involved regardless of any
increase in total costs.
``(B) Applicable percentage.--With respect to a plan
(or coverage), the applicable percentage described in
this subparagraph shall be--
``(i) 2 percent in the case of the first plan
year in which this section is applied; and
``(ii) 1 percent in the case of each
subsequent plan year.
``(C) Determinations by actuaries.--Determinations as
to increases in actual costs under a plan (or coverage)
for purposes of this section shall be made and
certified by a qualified and licensed actuary who is a
member in good standing of the American Academy of
Actuaries. All such determinations shall be in a
written report prepared by the actuary. The report, and
all underlying documentation relied upon by the
actuary, shall be maintained by the group health plan
or health insurance issuer for a period of 6 years
following the notification made under subparagraph (E).
``(D) 6-month determinations.--If a group health plan
(or a health insurance issuer offering coverage in
connection with a group health plan) seeks an exemption
under this paragraph, determinations under subparagraph
(A) shall be made after such plan (or coverage) has
complied with this section for the first 6 months of
the plan year involved.
``(E) Notification.--
``(i) In general.--A group health plan (or a
health insurance issuer offering coverage in
connection with a group health plan) that,
based upon a certification described under
subparagraph (C), qualifies for an exemption
under this paragraph, and elects to implement
the exemption, shall promptly notify the
Secretary, the appropriate State agencies, and
participants and beneficiaries in the plan of
such election.
``(ii) Requirement.--A notification to the
Secretary under clause (i) shall include--
``(I) a description of the number of
covered lives under the plan (or
coverage) involved at the time of the
notification, and as applicable, at the
time of any prior election of the cost-
exemption under this paragraph by such
plan (or coverage);
``(II) for both the plan year upon
which a cost exemption is sought and
the year prior, a description of the
actual total costs of coverage with
respect to medical and surgical
benefits and mental health and
substance use disorder benefits under
the plan; and
``(III) for both the plan year upon
which a cost exemption is sought and
the year prior, the actual total costs
of coverage with respect to mental
health and substance use disorder
benefits under the plan.
``(iii) Confidentiality.--A notification to
the Secretary under clause (i) shall be
confidential. The Secretary shall make
available, upon request and on not more than an
annual basis, an anonymous itemization of such
notifications, that includes--
``(I) a breakdown of States by the
size and type of employers submitting
such notification; and
``(II) a summary of the data received
under clause (ii).
``(F) Audits by appropriate agencies.--To determine
compliance with this paragraph, the Secretary may audit
the books and records of a group health plan or health
insurance issuer relating to an exemption, including
any actuarial reports prepared pursuant to subparagraph
(C), during the 6 year period following the
notification of such exemption under subparagraph (E).
A State agency receiving a notification under
subparagraph (E) may also conduct such an audit with
respect to an exemption covered by such notification.
``(d) Separate Application to Each Option Offered.--In the case of a
group health plan that offers a participant or beneficiary two or more
benefit package options under the plan, the requirements of this
section shall be applied separately with respect to each such option.
``(e) Definitions.--For purposes of this section--
``(1) Aggregate lifetime limit.--The term `aggregate lifetime
limit' means, with respect to benefits under a group health
plan or health insurance coverage, a dollar limitation on the
total amount that may be paid with respect to such benefits
under the plan or health insurance coverage with respect to an
individual or other coverage unit.
``(2) Annual limit.--The term `annual limit' means, with
respect to benefits under a group health plan or health
insurance coverage, a dollar limitation on the total amount of
benefits that may be paid with respect to such benefits in a
12-month period under the plan or health insurance coverage
with respect to an individual or other coverage unit.
``(3) Medical or surgical benefits.--The term `medical or
surgical benefits' means benefits with respect to medical or
surgical services, as defined under the terms of the plan or
coverage (as the case may be), but does not include mental
health or substance use disorder benefits.
``(4) Mental health benefits.--The term `mental health
benefits' means benefits with respect to services for mental
health conditions, as defined under the terms of the plan and
in accordance with applicable Federal and State law.
``(5) Substance use disorder benefits.--The term `substance
use disorder benefits' means benefits with respect to services
for substance use disorders, as defined under the terms of the
plan and in accordance with applicable Federal and State
law.''.
(2) Sunset.--Section 2726 of the Public Health Service Act
(42 U.S.C. 300gg-26) is amended by adding at the end the
following new subsection
``(f) Sunset.--The provisions of this section shall have no force or
effect after the date of the enactment of the Strengthening Behavioral
Health Parity Act.''.
(3) Administration; conforming amendments.--
(A) Application of implementation regulations.--The
provisions of sections 146.136 and 147.160 of title 45,
Code of Federal Regulations shall apply to section
2799A-1 of the Public Health Service Act, as added by
paragraph (1), in the same manner as such provisions
applied to section 2726 of the Public Health Service
Act (42 U.S.C. 300gg-26) before the date of the
enactment of this Act.
(B) Conforming amendments.--
(i) Section 2722 of the Public Health Service
Act (42 U.S.C. 300gg-21) is amended--
(I) in subsection (a)(1), by
inserting ``and part D'' after
``subparts 1 and 2'';
(II) in subsection (b), by inserting
``and part D'' after ``subparts 1 and
2'';
(III) in subsection (c)(1), by
inserting ``and part D'' after
``subparts 1 and 2'';
(IV) in subsection (c)(2), by
inserting ``and part D'' after
``subparts 1 and 2'';
(V) in subsection (c)(3), by
inserting ``and part D'' after ``this
part''; and
(VI) in subsection (d), in the matter
preceding paragraph (1), by inserting
``and part D'' after ``this part''.
(ii) Section 2723 of the Public Health
Service Act (42 U.S.C. 300gg-22) is amended--
(I) in subsection (a)(1), by
inserting ``and part D'' after ``this
part'';
(II) in subsection (a)(2), by
inserting ``or part D'' after ``this
part'';
(III) in subsection (b)(1), by
inserting ``or part D'' after ``this
part'';
(IV) in subsection (b)(2)(A), by
inserting ``or part D'' after ``this
part''; and
(V) in subsection (b)(2)(C)(ii), by
inserting ``and part D'' after ``this
part''.
(iii) Section 2724 of the Public Health
Service Act (42 U.S.C. 300gg-23) is amended--
(I) in subsection (a)(1)--
(aa) by striking ``this part
and part C insofar as it
relates to this part'' and
inserting ``this part, part D,
and part C insofar as it
relates to this part or part
D''; and
(bb) by inserting ``or part
D'' after ``requirement of this
part'';
(II) in subsection (a)(2), by
inserting ``or part D'' after ``this
part''; and
(III) in subsection (c), by inserting
``or part D'' after ``this part (other
than section 2704)''.
(b) ERISA.--Section 712(a) of the Employee Retirement Income Security
Act of 1974 (1185a(a)) is amended by adding at the end the following
new paragraphs:
``(6) Compliance program guidance document.--
``(A) In general.--Not later than 12 months after the
date of enactment of the Helping Families in Mental
Health Crisis Reform Act of 2016, the Secretary, the
Secretary of Health and Human Services, and the
Secretary of the Treasury, in consultation with the
Inspector General of the Department of Health and Human
Services, the Inspector General of the Department of
Labor, and the Inspector General of the Department of
the Treasury, shall issue a compliance program guidance
document to help improve compliance with this section,
section 2799A-1 of the Public Health Service Act, and
section 9812 of the Internal Revenue Code of 1986, as
applicable. In carrying out this paragraph, the
Secretaries may take into consideration the 2016
publication of the Department of Health and Human
Services and the Department of Labor, entitled `Warning
Signs - Plan or Policy Non-Quantitative Treatment
Limitations (NQTLs) that Require Additional Analysis to
Determine Mental Health Parity Compliance'.
``(B) Examples illustrating compliance and
noncompliance.--
``(i) In general.--The compliance program
guidance document required under this paragraph
shall provide illustrative, de-identified
examples (that do not disclose any protected
health information or individually identifiable
information) of previous findings of compliance
and noncompliance with this section, section
2799A-1 of the Public Health Service Act, or
section 9812 of the Internal Revenue Code of
1986, as applicable, based on investigations of
violations of such sections, including--
``(I) examples illustrating
requirements for information
disclosures and nonquantitative
treatment limitations; and
``(II) descriptions of the violations
uncovered during the course of such
investigations.
``(ii) Nonquantitative treatment
limitations.--To the extent that any example
described in clause (i) involves a finding of
compliance or noncompliance with regard to any
requirement for nonquantitative treatment
limitations, the example shall provide
sufficient detail to fully explain such
finding, including a full description of the
criteria involved for approving medical and
surgical benefits and the criteria involved for
approving mental health and substance use
disorder benefits.
``(iii) Access to additional information
regarding compliance.--In developing and
issuing the compliance program guidance
document required under this paragraph, the
Secretaries specified in subparagraph (A)--
``(I) shall enter into interagency
agreements with the Inspector General
of the Department of Health and Human
Services, the Inspector General of the
Department of Labor, and the Inspector
General of the Department of the
Treasury to share findings of
compliance and noncompliance with this
section, section 2799A-1 of the Public
Health Service Act, or section 9812 of
the Internal Revenue Code of 1986, as
applicable; and
``(II) shall seek to enter into an
agreement with a State to share
information on findings of compliance
and noncompliance with this section,
section 2799A-1 of the Public Health
Service Act, or section 9812 of the
Internal Revenue Code of 1986, as
applicable.
``(C) Recommendations.--The compliance program
guidance document shall include recommendations to
advance compliance with this section, section 2799A-1
of the Public Health Service Act, or section 9812 of
the Internal Revenue Code of 1986, as applicable, and
encourage the development and use of internal controls
to monitor adherence to applicable statutes,
regulations, and program requirements. Such internal
controls may include illustrative examples of
nonquantitative treatment limitations on mental health
and substance use disorder benefits, which may fail to
comply with this section, section 2799A-1 of the Public
Health Service Act, or section 9812 of the Internal
Revenue Code of 1986, as applicable, in relation to
nonquantitative treatment limitations on medical and
surgical benefits.
``(D) Updating the compliance program guidance
document.--The Secretary, the Secretary of Health and
Human Services, and the Secretary of the Treasury, in
consultation with the Inspector General of the
Department of Health and Human Services, the Inspector
General of the Department of Labor, and the Inspector
General of the Department of the Treasury, shall update
the compliance program guidance document every 2 years
to include illustrative, de-identified examples (that
do not disclose any protected health information or
individually identifiable information) of previous
findings of compliance and noncompliance with this
section, section 2799A-1 of the Public Health Service
Act, or section 9812 of the Internal Revenue Code of
1986, as applicable.
``(7) Additional guidance.--
``(A) In general.--Not later than 12 months after the
date of enactment of the Helping Families in Mental
Health Crisis Reform Act of 2016, the Secretary, the
Secretary of Health and Human Services, and the
Secretary of the Treasury shall issue guidance to group
health plans and health insurance issuers offering
group or individual health insurance coverage to assist
such plans and issuers in satisfying the requirements
of this section, section 2799A-1 of the Public Health
Service Act, or section 9812 of the Internal Revenue
Code of 1986, as applicable.
``(B) Disclosure.--
``(i) Guidance for plans and issuers.--The
guidance issued under this paragraph shall
include clarifying information and illustrative
examples of methods that group health plans and
health insurance issuers offering group or
individual health insurance coverage may use
for disclosing information to ensure compliance
with the requirements under this section,
section 2799A-1 of the Public Health Service
Act, or section 9812 of the Internal Revenue
Code of 1986, as applicable, (and any
regulations promulgated pursuant to such
sections, as applicable).
``(ii) Documents for participants,
beneficiaries, contracting providers, or
authorized representatives.--The guidance
issued under this paragraph shall include
clarifying information and illustrative
examples of methods that group health plans and
health insurance issuers offering group or
individual health insurance coverage may use to
provide any participant, beneficiary,
contracting provider, or authorized
representative, as applicable, with documents
containing information that the health plans or
issuers are required to disclose to
participants, beneficiaries, contracting
providers, or authorized representatives to
ensure compliance with this section, section
2799A-1 of the Public Health Service Act, or
section 9812 of the Internal Revenue Code of
1986, as applicable, compliance with any
regulation issued pursuant to such respective
section, or compliance with any other
applicable law or regulation. Such guidance
shall include information that is comparative
in nature with respect to--
``(I) nonquantitative treatment
limitations for both medical and
surgical benefits and mental health and
substance use disorder benefits;
``(II) the processes, strategies,
evidentiary standards, and other
factors used to apply the limitations
described in subclause (I); and
``(III) the application of the
limitations described in subclause (I)
to ensure that such limitations are
applied in parity with respect to both
medical and surgical benefits and
mental health and substance use
disorder benefits.
``(C) Nonquantitative treatment limitations.--The
guidance issued under this paragraph shall include
clarifying information and illustrative examples of
methods, processes, strategies, evidentiary standards,
and other factors that group health plans and health
insurance issuers offering group or individual health
insurance coverage may use regarding the development
and application of nonquantitative treatment
limitations to ensure compliance with this section,
section 2799A-1 of the Public Health Service Act, or
section 9812 of the Internal Revenue Code of 1986, as
applicable, (and any regulations promulgated pursuant
to such respective section), including--
``(i) examples of methods of determining
appropriate types of nonquantitative treatment
limitations with respect to both medical and
surgical benefits and mental health and
substance use disorder benefits, including
nonquantitative treatment limitations
pertaining to--
``(I) medical management standards
based on medical necessity or
appropriateness, or whether a treatment
is experimental or investigative;
``(II) limitations with respect to
prescription drug formulary design; and
``(III) use of fail-first or step
therapy protocols;
``(ii) examples of methods of determining--
``(I) network admission standards
(such as credentialing); and
``(II) factors used in provider
reimbursement methodologies (such as
service type, geographic market, demand
for services, and provider supply,
practice size, training, experience,
and licensure) as such factors apply to
network adequacy;
``(iii) examples of sources of information
that may serve as evidentiary standards for the
purposes of making determinations regarding the
development and application of nonquantitative
treatment limitations;
``(iv) examples of specific factors, and the
evidentiary standards used to evaluate such
factors, used by such plans or issuers in
performing a nonquantitative treatment
limitation analysis;
``(v) examples of how specific evidentiary
standards may be used to determine whether
treatments are considered experimental or
investigative;
``(vi) examples of how specific evidentiary
standards may be applied to each service
category or classification of benefits;
``(vii) examples of methods of reaching
appropriate coverage determinations for new
mental health or substance use disorder
treatments, such as evidence-based early
intervention programs for individuals with a
serious mental illness and types of medical
management techniques;
``(viii) examples of methods of reaching
appropriate coverage determinations for which
there is an indirect relationship between the
covered mental health or substance use disorder
benefit and a traditional covered medical and
surgical benefit, such as residential treatment
or hospitalizations involving voluntary or
involuntary commitment; and
``(ix) additional illustrative examples of
methods, processes, strategies, evidentiary
standards, and other factors for which the
Secretary determines that additional guidance
is necessary to improve compliance with this
section, section 2799A-1 of the Public Health
Service Act, or section 9812 of the Internal
Revenue Code of 1986, as applicable.
``(D) Public comment.--Prior to issuing any final
guidance under this paragraph, the Secretary shall
provide a public comment period of not less than 60
days during which any member of the public may provide
comments on a draft of the guidance.
``(8) Compliance requirements.--
``(A) Nonquantitative treatment limitation (nqtl)
requirements.--Beginning 45 days after the date of
enactment of this paragraph, in the case of a group
health plan or a health insurance issuer offering group
health insurance coverage that provides both medical
and surgical benefits and mental health or substance
use disorder benefits and that imposes nonquantitative
treatment limitations (referred to in this section as
`NQTL') on mental health or substance use disorder
benefits, the plan or issuer offering health insurance
coverage shall perform comparative analyses of the
design and application of NQTLs in accordance with
subparagraph (B), and make available to the applicable
State authority (or, as applicable, the Secretary),
upon request, the following information:
``(i) The specific plan or coverage terms
regarding the NQTL, that applies to such plan
or coverage, and a description of all mental
health or substance use disorder and medical or
surgical benefits to which it applies in each
respective benefits classification.
``(ii) The factors used to determine that the
NQTL will apply to mental health or substance
use disorder benefits and medical or surgical
benefits.
``(iii) The evidentiary standards used for
the factors identified in clause (ii), when
applicable, provided that every factor shall be
defined and any other source or evidence relied
upon to design and apply the NQTL to mental
health or substance use disorder benefits and
medical or surgical benefits.
``(iv) The comparative analyses demonstrating
that the processes, strategies, evidentiary
standards, and other factors used to design the
NQTL, as written, and the operation processes
and strategies as written and in operation that
are used to apply the NQTL for mental health or
substance use disorder benefits are comparable
to, and are applied no more stringently than,
the processes, strategies, evidentiary
standards, and other factors used to design the
NQTL, as written, and the operation processes
and strategies as written and in operation that
are used to apply the NQTL to medical or
surgical benefits.
``(v) A disclosure of the specific findings
and conclusions reached by the plan or coverage
that the results of the analyses described in
this subparagraph indicate that the plan or
coverage is in compliance with this section.
``(B) Secretary request process.--
``(i) Submission upon request.--The Secretary
shall request that a group health plan or a
health insurance issuer offering group health
insurance coverage submit the comparative
analyses described in subparagraph (A) for
plans that involve potential violations of this
section or complaints regarding noncompliance
with this section that concern NQTLs and any
other instances in which the Secretary
determines appropriate. The Secretary shall
request not fewer than 20 such analyses per
year.
``(ii) Additional information.--In instances
in which the Secretary has concluded that the
plan or coverage has not submitted sufficient
information for the Secretary to review the
comparative analyses described in subparagraph
(A), as requested under clause (i), the
Secretary shall specify to the plan or coverage
the information the plan or coverage must
submit to be responsive to the request under
clause (i) for the Secretary to review the
comparative analyses described in
subparagraph(A) for compliance with this
section. Nothing in this paragraph shall
require the Secretary to conclude that a plan
is in compliance with this section solely based
upon the inspection of the comparative analyses
described in subparagraph (A), as requested
under clause (i).
``(iii) Required action.--
``(I) In general.--In instances in
which the Secretary has reviewed the
comparative analyses described in
subparagraph (A), as requested under
clause (i), and determined that the
plan or coverage is not in compliance
with this section, the plan or
coverage--
``(aa) shall specify to the
Secretary the actions the plan
or coverage will take to be in
compliance with this section
and provide to the Secretary
comparative analyses described
in subparagraph (A) that
demonstrate compliance with
this section not later than 45
days after the initial
determination by the Secretary
that the plan or coverage is
not in compliance; and
``(bb) following the 45-day
corrective action period under
item (aa), if the Secretary
determines that the plan or
coverage still is not in
compliance with this section,
not later than 7 days after
such determination, shall
notify all individuals enrolled
in the plan or coverage that
the plan or coverage has been
determined to be not in
compliance with this section.
``(II) Exemption from disclosure.--
Documents or communications produced in
connection with the Secretary's
recommendations to the plan or coverage
shall not be subject to disclosure
pursuant to section 552 of title 5,
United States Code.
``(iv) Report.--Not later than 1 year after
the date of enactment of this paragraph, and
not later than October 1 of each year
thereafter, the Secretary shall submit to
Congress, and make publicly available, a report
that contains--
``(I) a summary of the comparative
analyses requested under clause (i),
including the identity of each plan or
coverage that is determined to be not
in compliance after the final
determination by the Secretary
described in clause (iii)(I)(bb);
``(II) the Secretary's conclusions as
to whether each plan or coverage
submitted sufficient information for
the Secretary to review the comparative
analyses requested under clause (i) for
compliance with this section;
``(III) for each plan or coverage
that did submit sufficient information
for the Secretary to review the
comparative analyses requested under
clause (i), the Secretary's conclusions
as to whether and why the plan or
coverage is in compliance with the
requirements under this section;
``(IV) the Secretary's specifications
described in clause (ii) for each plan
or coverage that the Secretary
determined did not submit sufficient
information for the Secretary to review
the comparative analyses requested
under clause (i) for compliance with
this section; and
``(V) the Secretary's specifications
described in clause (iii) of the
actions each plan or coverage that the
Secretary determined is not in
compliance with this section must take
to be in compliance with this section,
including the reason why the Secretary
determined the plan or coverage is not
in compliance.
``(C) Compliance program guidance document update
process.--
``(i) In general.--The Secretary shall
include instances of noncompliance that the
Secretary discovers upon reviewing the
comparative analyses requested under
subparagraph (B)(i) in the compliance program
guidance document described in paragraph (6),
as it is updated every 2 years, except that
such instances shall not disclose any protected
health information or individually identifiable
information.
``(ii) Guidance and regulations.--Not later
than 18 months after the date of enactment of
this paragraph, the Secretary shall finalize
any draft or interim guidance and regulations
relating to mental health parity under this
section. Such draft guidance shall include
guidance to clarify the process and timeline
for current and potential participants and
beneficiaries (and authorized representatives
and health care providers of such participants
and beneficiaries) with respect to plans to
file complaints of such plans or issuers being
in violation of this section, including
guidance, by plan type, on the relevant State,
regional, or national office with which such
complaints should be filed.
``(iii) State.--The Secretary shall share
information on findings of compliance and
noncompliance discovered upon reviewing the
comparative analyses requested under
subparagraph (B)(i) with the State where the
group health plan is located or the State where
the health insurance issuer is licensed to do
business for coverage offered by a health
insurance issuer in the group market, in
accordance with paragraph (6)(B)(iii)(II).''.
(c) IRC.--Section 9812 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new paragraphs:
``(6) Compliance program guidance document.--
``(A) In general.--Not later than 12 months after the
date of enactment of the Helping Families in Mental
Health Crisis Reform Act of 2016, the Secretary, the
Secretary of Labor, and the Secretary of Health and
Human Services, in consultation with the Inspector
General of the Department of Health and Human Services,
the Inspector General of the Department of Labor, and
the Inspector General of the Department of the
Treasury, shall issue a compliance program guidance
document to help improve compliance with this section,
section 712 of the Employee Retirement Income Security
Act of 1974, and section 2799A-1 of the Public Health
Service Act, as applicable. In carrying out this
paragraph, the Secretaries may take into consideration
the 2016 publication of the Department of Health and
Human Services and the Department of Labor, entitled
`Warning Signs - Plan or Policy Non-Quantitative
Treatment Limitations (NQTLs) that Require Additional
Analysis to Determine Mental Health Parity Compliance'.
``(B) Examples illustrating compliance and
noncompliance.--
``(i) In general.--The compliance program
guidance document required under this paragraph
shall provide illustrative, de-identified
examples (that do not disclose any protected
health information or individually identifiable
information) of previous findings of compliance
and noncompliance with this section, section
712 of the Employee Retirement Income Security
Act of 1974, or section 2799A-1 of the Public
Health Service Act, as applicable, based on
investigations of violations of such sections,
including--
``(I) examples illustrating
requirements for information
disclosures and nonquantitative
treatment limitations; and
``(II) descriptions of the violations
uncovered during the course of such
investigations.
``(ii) Nonquantitative treatment
limitations.--To the extent that any example
described in clause (i) involves a finding of
compliance or noncompliance with regard to any
requirement for nonquantitative treatment
limitations, the example shall provide
sufficient detail to fully explain such
finding, including a full description of the
criteria involved for approving medical and
surgical benefits and the criteria involved for
approving mental health and substance use
disorder benefits.
``(iii) Access to additional information
regarding compliance.--In developing and
issuing the compliance program guidance
document required under this paragraph, the
Secretaries specified in subparagraph (A)--
``(I) shall enter into interagency
agreements with the Inspector General
of the Department of Health and Human
Services, the Inspector General of the
Department of Labor, and the Inspector
General of the Department of the
Treasury to share findings of
compliance and noncompliance with this
section, section 712 of the Employee
Retirement Income Security Act of 1974,
or section 2799A-1 of the Public Health
Service Act, as applicable; and
``(II) shall seek to enter into an
agreement with a State to share
information on findings of compliance
and noncompliance with this section,
section 712 of the Employee Retirement
Income Security Act of 1974, or section
2799A-1 of the Public Health Service
Act, as applicable.
``(C) Recommendations.--The compliance program
guidance document shall include recommendations to
advance compliance with this section, section 712 of
the Employee Retirement Income Security Act of 1974, or
section 2799A-1 of the Public Health Service Act, as
applicable, and encourage the development and use of
internal controls to monitor adherence to applicable
statutes, regulations, and program requirements. Such
internal controls may include illustrative examples of
nonquantitative treatment limitations on mental health
and substance use disorder benefits, which may fail to
comply with this section, section 712 of the Employee
Retirement Income Security Act of 1974, or section
2799A-1 of the Public Health Service Act, as
applicable, in relation to nonquantitative treatment
limitations on medical and surgical benefits.
``(D) Updating the compliance program guidance
document.--The Secretary, the Secretary of Labor, and
the Secretary of Health and Human Services, in
consultation with the Inspector General of the
Department of Health and Human Services, the Inspector
General of the Department of Labor, and the Inspector
General of the Department of the Treasury, shall update
the compliance program guidance document every 2 years
to include illustrative, de-identified examples (that
do not disclose any protected health information or
individually identifiable information) of previous
findings of compliance and noncompliance with this
section, section 712 of the Employee Retirement Income
Security Act of 1974, or section 2799A-1 of the Public
Health Service Act, as applicable.
``(7) Additional guidance.--
``(A) In general.--Not later than 12 months after the
date of enactment of the Helping Families in Mental
Health Crisis Reform Act of 2016, the Secretary, the
Secretary of Labor, and the Secretary of Health and
Human Services shall issue guidance to group health
plans and health insurance issuers offering group or
individual health insurance coverage to assist such
plans and issuers in satisfying the requirements of
this section, section 712 of the Employee Retirement
Income Security Act of 1974, or section 2799A-1 of the
Public Health Service Act, as applicable.
``(B) Disclosure.--
``(i) Guidance for plans and issuers.--The
guidance issued under this paragraph shall
include clarifying information and illustrative
examples of methods that group health plans and
health insurance issuers offering group or
individual health insurance coverage may use
for disclosing information to ensure compliance
with the requirements under this section,
section 712 of the Employee Retirement Income
Security Act of 1974, or section 2799A-1 of the
Public Health Service Act, (and any regulations
promulgated pursuant to such sections, as
applicable).
``(ii) Documents for participants,
beneficiaries, contracting providers, or
authorized representatives.--The guidance
issued under this paragraph shall include
clarifying information and illustrative
examples of methods that group health plans and
health insurance issuers offering group or
individual health insurance coverage may use to
provide any participant, beneficiary,
contracting provider, or authorized
representative, as applicable, with documents
containing information that the health plans or
issuers are required to disclose to
participants, beneficiaries, contracting
providers, or authorized representatives to
ensure compliance with this section, section
712 of the Employee Retirement Income Security
Act of 1974, or section 2799A-1 of the Public
Health Service Act, as applicable, compliance
with any regulation issued pursuant to such
respective section, or compliance with any
other applicable law or regulation. Such
guidance shall include information that is
comparative in nature with respect to--
``(I) nonquantitative treatment
limitations for both medical and
surgical benefits and mental health and
substance use disorder benefits;
``(II) the processes, strategies,
evidentiary standards, and other
factors used to apply the limitations
described in subclause (I); and
``(III) the application of the
limitations described in subclause (I)
to ensure that such limitations are
applied in parity with respect to both
medical and surgical benefits and
mental health and substance use
disorder benefits.
``(C) Nonquantitative treatment limitations.--The
guidance issued under this paragraph shall include
clarifying information and illustrative examples of
methods, processes, strategies, evidentiary standards,
and other factors that group health plans and health
insurance issuers offering group or individual health
insurance coverage may use regarding the development
and application of nonquantitative treatment
limitations to ensure compliance with this section,
section 712 of the Employee Retirement Income Security
Act of 1974, or section 2799A-1 of the Public Health
Service Act, as applicable, (and any regulations
promulgated pursuant to such respective section),
including--
``(i) examples of methods of determining
appropriate types of nonquantitative treatment
limitations with respect to both medical and
surgical benefits and mental health and
substance use disorder benefits, including
nonquantitative treatment limitations
pertaining to--
``(I) medical management standards
based on medical necessity or
appropriateness, or whether a treatment
is experimental or investigative;
``(II) limitations with respect to
prescription drug formulary design; and
``(III) use of fail-first or step
therapy protocols;
``(ii) examples of methods of determining--
``(I) network admission standards
(such as credentialing); and
``(II) factors used in provider
reimbursement methodologies (such as
service type, geographic market, demand
for services, and provider supply,
practice size, training, experience,
and licensure) as such factors apply to
network adequacy;
``(iii) examples of sources of information
that may serve as evidentiary standards for the
purposes of making determinations regarding the
development and application of nonquantitative
treatment limitations;
``(iv) examples of specific factors, and the
evidentiary standards used to evaluate such
factors, used by such plans or issuers in
performing a nonquantitative treatment
limitation analysis;
``(v) examples of how specific evidentiary
standards may be used to determine whether
treatments are considered experimental or
investigative;
``(vi) examples of how specific evidentiary
standards may be applied to each service
category or classification of benefits;
``(vii) examples of methods of reaching
appropriate coverage determinations for new
mental health or substance use disorder
treatments, such as evidence-based early
intervention programs for individuals with a
serious mental illness and types of medical
management techniques;
``(viii) examples of methods of reaching
appropriate coverage determinations for which
there is an indirect relationship between the
covered mental health or substance use disorder
benefit and a traditional covered medical and
surgical benefit, such as residential treatment
or hospitalizations involving voluntary or
involuntary commitment; and
``(ix) additional illustrative examples of
methods, processes, strategies, evidentiary
standards, and other factors for which the
Secretary determines that additional guidance
is necessary to improve compliance with this
section, section 712 of the Employee Retirement
Income Security Act of 1974, or section 2799A-1
of the Public Health Service Act, as
applicable.
``(D) Public comment.--Prior to issuing any final
guidance under this paragraph, the Secretary shall
provide a public comment period of not less than 60
days during which any member of the public may provide
comments on a draft of the guidance.
``(8) Compliance requirements.--
``(A) Nonquantitative treatment limitation (nqtl)
requirements.--Beginning 45 days after the date of
enactment of this paragraph, in the case of a group
health plan that provides both medical and surgical
benefits and mental health or substance use disorder
benefits and that imposes nonquantitative treatment
limitations (referred to in this section as `NQTL') on
mental health or substance use disorder benefits, the
plan shall perform comparative analyses of the design
and application of NQTLs in accordance with
subparagraph (B), and make available to the applicable
State authority (or, as applicable, the Secretary),
upon request, the following information:
``(i) The specific plan terms regarding the
NQTL, that applies to such plan or coverage,
and a description of all mental health or
substance use disorder and medical or surgical
benefits to which it applies in each respective
benefits classification.
``(ii) The factors used to determine that the
NQTL will apply to mental health or substance
use disorder benefits and medical or surgical
benefits.
``(iii) The evidentiary standards used for
the factors identified in clause (ii), when
applicable, provided that every factor shall be
defined and any other source or evidence relied
upon to design and apply the NQTL to mental
health or substance use disorder benefits and
medical or surgical benefits.
``(iv) The comparative analyses demonstrating
that the processes, strategies, evidentiary
standards, and other factors used to design the
NQTL, as written, and the operation processes
and strategies as written and in operation that
are used to apply the NQTL for mental health or
substance use disorder benefits are comparable
to, and are applied no more stringently than,
the processes, strategies, evidentiary
standards, and other factors used to design the
NQTL, as written, and the operation processes
and strategies as written and in operation that
are used to apply the NQTL to medical or
surgical benefits.
``(v) A disclosure of the specific findings
and conclusions reached by the plan that the
results of the analyses described in this
subparagraph indicate that the plan is in
compliance with this section.
``(B) Secretary request process.--
``(i) Submission upon request.--The Secretary
shall request that a group health plan submit
the comparative analyses described in
subparagraph (A) for plans that involve
potential violations of this section or
complaints regarding noncompliance with this
section that concern NQTLs and any other
instances in which the Secretary determines
appropriate. The Secretary shall request not
fewer than 20 such analyses per year.
``(ii) Additional information.--In instances
in which the Secretary has concluded that the
plan has not submitted sufficient information
for the Secretary to review the comparative
analyses described in subparagraph (A), as
requested under clause (i), the Secretary shall
specify to the plan the information the plan or
coverage must submit to be responsive to the
request under clause (i) for the Secretary to
review the comparative analyses described in
subparagraph(A) for compliance with this
section. Nothing in this paragraph shall
require the Secretary to conclude that a plan
is in compliance with this section solely based
upon the inspection of the comparative analyses
described in subparagraph (A), as requested
under clause (i).
``(iii) Required action.--
``(I) In general.--In instances in
which the Secretary has reviewed the
comparative analyses described in
subparagraph (A), as requested under
clause (i), and determined that the
plan is not in compliance with this
section, the plan--
``(aa) shall specify to the
Secretary the actions the plan
will take to be in compliance
with this section and provide
to the Secretary comparative
analyses described in
subparagraph (A) that
demonstrate compliance with
this section not later than 45
days after the initial
determination by the Secretary
that the plan is not in
compliance; and
``(bb) following the 45-day
corrective action period under
item (aa), if the Secretary
determines that the plan still
is not in compliance with this
section, not later than 7 days
after such determination, shall
notify all individuals enrolled
in the plan or coverage that
the plan has been determined to
be not in compliance with this
section.
``(II) Exemption from disclosure.--
Documents or communications produced in
connection with the Secretary's
recommendations to the plan or coverage
shall not be subject to disclosure
pursuant to section 552 of title 5,
United States Code.
``(iv) Report.--Not later than 1 year after
the date of enactment of this paragraph, and
not later than October 1 of each year
thereafter, the Secretary shall submit to
Congress, and make publicly available, a report
that contains--
``(I) a summary of the comparative
analyses requested under clause (i),
including the identity of each plan
that is determined to be not in
compliance after the final
determination by the Secretary
described in clause (iii)(I)(bb);
``(II) the Secretary's conclusions as
to whether each plan submitted
sufficient information for the
Secretary to review the comparative
analyses requested under clause (i) for
compliance with this section;
``(III) for each plan that did submit
sufficient information for the
Secretary to review the comparative
analyses requested under clause (i),
the Secretary's conclusions as to
whether and why the plan or coverage is
in compliance with the requirements
under this section;
``(IV) the Secretary's specifications
described in clause (ii) for each plan
that the Secretary determined did not
submit sufficient information for the
Secretary to review the comparative
analyses requested under clause (i) for
compliance with this section; and
``(V) the Secretary's specifications
described in clause (iii) of the
actions each plan hat the Secretary
determined is not in compliance with
this section must take to be in
compliance with this section, including
the reason why the Secretary determined
the plan or coverage is not in
compliance.
``(C) Compliance program guidance document update
process.--
``(i) In general.--The Secretary shall
include instances of noncompliance that the
Secretary discovers upon reviewing the
comparative analyses requested under
subparagraph (B)(i) in the compliance program
guidance document described in paragraph (6),
as it is updated every 2 years, except that
such instances shall not disclose any protected
health information or individually identifiable
information.
``(ii) Guidance and regulations.--Not later
than 18 months after the date of enactment of
this paragraph, the Secretary shall finalize
any draft or interim guidance and regulations
relating to mental health parity under this
section. Such draft guidance shall include
guidance to clarify the process and timeline
for current and potential participants and
beneficiaries (and authorized representatives
and health care providers of such participants
and beneficiaries) with respect to plans to
file complaints of such plans or issuers being
in violation of this section, including
guidance, by plan type, on the relevant State,
regional, or national office with which such
complaints should be filed.
``(iii) State.--The Secretary shall share
information on findings of compliance and
noncompliance discovered upon reviewing the
comparative analyses requested under
subparagraph (B)(i) with the State where the
group health plan is located or the State where
the health insurance issuer is licensed to do
business for coverage offered by a health
insurance issuer in the group market, in
accordance with paragraph (6)(B)(iii)(II).''.
(d) Implementation.--The Secretary of Health and Human Services, the
Secretary of Labor, and the Secretary of the Treasury may implement the
paragraph (8) of section 2799A-1(a) of the Public Health Service Act,
added by subsection (a), the paragraph (8) of section 712(a) of the
Employee Retirement Income Security Act of 1974, as addedby subsection
(b), and the paragraph (8) of section 9812(a) of the Internal Revenue
Code of 1986, as added by subsection (c), by program instruction,
guidance, or otherwise.
I. Purpose and Summary
H.R. 7539, the ``Strengthening Behavioral Parity Act'' was
introduced by Representative Joseph P. Kennedy III (D-MA),
Katie Porter (D-CA), Gus M. Bilirakis (R-FL), and Fred Upton
(R-MI) and referred to the Committee on Energy and Commerce.
The goal of H.R. 7539 is to help improve and strengthen
enforcement of existing mental health parity laws. The
legislation would increase transparency with respect to how
health insurance plans are applying mental health parity laws
by requiring plans to make available certain analyses of how
they are applying non-quantitative treatment limits (NQTLs) to
mental health and substance use disorder benefits, in
comparison to medical and surgical benefits. The bill would
also require Federal regulators to request no fewer than 20
comparative analyses per year, including for health plans where
there have been potential violations or complaints regarding
noncompliance with mental health parity standards.
II. Background and Need for Legislation
The Mental Health Parity Act of 1996 (MHPA) prevented large
group health plans from imposing annual or lifetime dollar
limits on mental health benefits that are less favorable than
such limits imposed on medical and surgical benefits. In 2008,
Congress passed the Paul Wellstone and Pete Domenici Mental
Health Parity and Addiction Equity Act of 2008 (MHPAEA), which
requires parity between mental health or substance use disorder
benefits, and medical and surgical benefits. MHPAEA prohibits
coverage requirements for mental health and substance disorder
benefits from being more restrictive than those for medical and
surgical benefits, and prevents health insurance plans that
provide mental health or substance use disorder benefits from
imposing less favorable financial requirements and treatment
limitations on those benefits than on medical and surgical
benefits. The Affordable Care Act (ACA) amended MHPAEA and
applied the mental health parity provisions to individual
market plans, including qualified health plans offered through
the ACA Marketplaces.
The MHPAEA provided important protections for millions of
individuals enrolled in private insurance coverage. Many
challenges, however, remain. A Government Accountability Office
(GAO) report found that the extent of compliance with parity
requirements is unknown.\1\ The same report also concluded that
the complexity of assessing NQTLs makes it difficult for
regulators to identify instances of non-compliance. The report
found, however, that in 11 of the 14 States surveyed,
noncompliance with parity standards was related to NQTLs half
the time or more.\2\ Similarly, the Department of Labor
reported that 55 percent of noncompliance was related to NQTLs
in fiscal year 2018.\3\ Greater transparency and
standardization of NQTLs will help regulators more easily
identify instances of noncompliance and will aid in enforcement
of parity laws.
---------------------------------------------------------------------------
\1\U.S. Government Accountability Office, Mental Health and
Substance Use, State and Federal Oversight of Compliance with Parity
Requirements Vary (2019) (www.gao.gov/assets/710/703239.pdf)
\2\Id.
\3\Id.
---------------------------------------------------------------------------
Between 2010 and 2018, Federal regulators conducted 1,700
investigations in connection with MHPAEA, and found more than
300 violations that involved mental health and substance use
disorder benefits.\4\ Federal regulators lack the statutory
authority, however, to actively enforce MHPAEA directly against
insurers by requiring them to correct noncompliant health
insurance policies that are sold by insurers to numerous
employers in the group health market.\5\
---------------------------------------------------------------------------
\4\U.S. Department of Labor, Report to Congress, Pathway to Full
Parity (2018) U.S. Department of Labor, Report to Congress, Pathway to
Full Parity (2018) (www.dol.gov/sites/dolgov/files/EBSA/laws-and-
regulations/laws/mental-health-parity/dol-report-to-congress-2018-
pathway-to-full-parity.pdf).
\5\Id.
---------------------------------------------------------------------------
H.R. 7539 would help improve and strengthen enforcement of
existing mental health parity laws. The bill would increase
transparency with respect to how health insurance plans are
applying mental health parity laws, by requiring health plans
to make available certain analyses of how plans are applying
NQTLs to mental health and substance use disorder benefits, in
comparison to medical and surgical benefits. The legislation
would require Federal regulators to request comparative
analyses for health plans that have been involved in potential
violations or complaints regarding noncompliance with mental
health parity standards, and to request no fewer than 20
comparative analyses per year. For health plans that are found
to be out of compliance with mental health parity laws, the
bill would require plans to take corrective action to come into
compliance, or notify all individuals enrolled in noncompliant
plans of plan's violations.
III. Committee Hearings
For the purposes of section 103(i) of H. Res. 6 of the
116th Congress, the following hearing was used to develop or
consider H.R. 7539:
On June 30, 2020, the Subcommittee on Health held a hearing
on a number of bills to address behavioral health treatment and
access, including H.R. 2874 and H.R. 3165, entitled ``High
Anxiety and Stress: Legislation to Improve Mental Health During
Crisis.'' H.R. 2874 and H.R. 3165 covered the topics of the
provisions in H.R. 7539. The Subcommittee received testimony
from:
The Honorable Patrick J. Kennedy, Founder,
The Kennedy Forum, and former Member of Congress
Dr. Arthur C. Evans, Jr., Chief Executive
Officer, American Psychological Association
Dr. Jeffrey L. Geller, President, American
Psychiatric Association
Arriana Gross, National Youth Advisory Board
Member, Sandy Hook Promise Students Against Violence
Everywhere (SAVE) Promise Club.
IV. Committee Consideration
H.R. 7539 was introduced on July 9, 2020, by
Representatives Kennedy, Porter, Bilirakis, and Upton and
referred to the Committee on Energy and Commerce. The bill was
subsequently referred to the Subcommittee on Health on July 10,
2020.
On July 15, 2020, H.R. 7539 was discharged from the
Subcommittee on Health as the bill was called up by the full
Committee. The Committee on Energy and Commerce met in virtual
open markup session, pursuant to notice, on July 15, 2020, to
consider H.R. 7539. During the bill's consideration, a
manager's amendment offered by Mr. Kennedy was agreed to by a
voice vote. The Committee then agreed to a motion on final
passage offered by Mr. Pallone, Chairman of the committee, to
order H.R. 7539 reported favorably to the House, amended, by a
voice vote, a quorum being present.
V. Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list each record vote
on the motion to report legislation and amendments thereto. The
Committee advises that there were no record votes taken on
H.R.7539, including on the motion by Mr. Pallone ordering H.R.
7539 favorably reported to the House, amended.
VI. Oversight Findings
Pursuant to clause 3(c)(1) of rule XIII and clause 2(b)(1)
of rule X of the Rules of the House of Representatives, the
oversight findings and recommendations of the Committee are
reflected in the descriptive portion of the report.
VII. New Budget Authority, Entitlement Authority, and Tax Expenditures
Pursuant to 3(c)(2) of rule XIII of the Rules of the House
of Representatives, the Committee adopts as its own the
estimate of new budget authority, entitlement authority, or tax
expenditures or revenues contained in the cost estimate
prepared by the Director of the Congressional Budget Office
pursuant to section 402 of the Congressional Budget Act of
1974.
The Committee has requested but not received from the
Director of the Congressional Budget Office a statement as to
whether this bill contains any new budget authority, spending
authority, credit authority, or an increase or decrease in
revenues or tax expenditures.
VIII. Federal Mandates Statement
The Committee adopts as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
X. Statement of General Performance Goals and Objectives
Pursuant to clause 3(c)(4) of rule XIII, the general
performance goal or objective of this legislation is to help
improve and strengthen enforcement of existing mental health
parity laws. The bill would increase transparency with respect
to how health insurance plans are applying mental health parity
laws by requiring plans to make available certain analyses of
how plans are applying non-quantitative treatment limits
(NQTLs) to mental health and substance use disorder benefits,
in comparison to medical and surgical benefits.
XI. Duplication of Federal Programs
Pursuant to clause 3(c)(5) of rule XIII, no provision of
H.R. 7539 is known to be duplicative of another Federal
program, including any program that was included in a report to
Congress pursuant to section 21 of Public Law 111-139 or the
most recent Catalog of Federal Domestic Assistance.
XII. Committee Cost Estimate
Pursuant to clause 3(d)(1) of rule XIII, the Committee
adopts as its own the cost estimate prepared by the Director of
the Congressional Budget Office pursuant to section 402 of the
Congressional Budget Act of 1974.
XIII. Earmarks, Limited Tax Benefits, and Limited Tariff Benefits
Pursuant to clause 9(e), 9(f), and 9(g) of rule XXI, the
Committee finds that H.R. 7539 contains no earmarks, limited
tax benefits, or limited tariff benefits.
XIV. Advisory Committee Statement
No advisory committee within the meaning of section 5(b) of
the Federal Advisory Committee Act was created by this
legislation.
XV. Applicability to Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
XVI. Section-by-Section Analysis of the Legislation
Section 1. Short title
Section 1 designates that the short title may be cited as
the ``Strengthening Behavioral Parity Act''.
Sec. 2. Strengthening parity in mental health and substance use
disorder benefits
Section 2 amends title XXVII of the Public Health Service
Act (PHSA) by inserting the following new part.
Part D--Additional Coverage Provisions
Sec. 2799A-1. Parity in mental health and substance use disorder
benefits
Section 2799A-1 sunsets section 2726 of the PHSA that
contains the Federal mental health parity requirements, and
reestablishes those requirements under the new part D, section
2799A-1. By sunsetting section 2726 of the PHSA, the section
does not make any substantive policy changes to amend the law,
and the Federal mental health parity requirements are still in
effect. The section merely reestablishes the mental health
parity requirements under the new part D.
Section 2799A-1 establishes new requirement on health
insurance plans with respect to how health insurance plans are
applying existing mental health parity laws. The section
requires health plans to make available comparative analyses of
how health plans are applying NQTLs to mental health and
substance use disorder benefits, in comparison to medical and
surgical benefits, and to make available the analyses to State
and Federal regulators upon request. The section would require
the Secretary of Health and Human Services (HHS) to request no
fewer than 20 comparative analyses per year, including for
health plans that involve potential violations or complaints
regarding noncompliance with mental health parity standards.
For health plans that are found to be out of compliance
with mental health parity laws, the section would require the
Secretary to specify corrective action for the plan to come
into compliance, which the plan will have 45 days to implement.
If the plan is still not in compliance after those 45 days, the
section would require the plan to notify all individuals
enrolled in noncompliant plans within 7 days.
The section would require the Secretary of HHS to publish
and submit to Congress an annual report that includes a summary
of the comparative analyses, the Secretary's conclusions as to
whether each plan submitted sufficient information for the
Secretary to review the comparative analyses, the Secretary's
conclusions as to whether and why the plan is in compliance
with the mental health parity requirements, and the identity of
each plan that is determined to be out of compliance after the
final determination. Lastly, the section requires the Secretary
to include instances of noncompliance in the compliance program
document that is updated every two years.
Section 2 also amends section 712 of the Employee
Retirement Security Act of 1974 and section 9812 of the
Internal Revenue Code of 1986, and establishes the same new
requirement on group health insurance plans with respect to how
group health plans are applying existing mental health parity
laws.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italics, and existing law in which no
change is proposed is shown in roman):
PUBLIC HEALTH SERVICE ACT
TITLE XXVII--REQUIREMENTS RELATING TO HEALTH INSURANCE COVERAGE
PART A--INDIVIDUAL AND GROUP MARKET REFORMS
* * * * * * *
Subpart II--Improving Coverage
* * * * * * *
SEC. 2726. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DISORDER BENEFITS.
(a) In General.--
(1) Aggregate lifetime limits.--In the case of a
group health plan or a health insurance issuer offering
group or individual health insurance coverage that
provides both medical and surgical benefits and mental
health or substance use disorder benefits--
(A) No lifetime limit.--If the plan or
coverage does not include an aggregate lifetime
limit on substantially all medical and surgical
benefits, the plan or coverage may not impose
any aggregate lifetime limit on mental health
or substance use disorder benefits.
(B) Lifetime limit.--If the plan or coverage
includes an aggregate lifetime limit on
substantially all medical and surgical benefits
(in this paragraph referred to as the
``applicable lifetime limit''), the plan or
coverage shall either--
(i) apply the applicable lifetime
limit both to the medical and surgical
benefits to which it otherwise would
apply and to mental health and
substance use disorder benefits and not
distinguish in the application of such
limit between such medical and surgical
benefits and mental health and
substance use disorder benefits; or
(ii) not include any aggregate
lifetime limit on mental health or
substance use disorder benefits that is
less than the applicable lifetime
limit.
(C) Rule in case of different limits.--In the
case of a plan or coverage that is not
described in subparagraph (A) or (B) and that
includes no or different aggregate lifetime
limits on different categories of medical and
surgical benefits, the Secretary shall
establish rules under which subparagraph (B) is
applied to such plan or coverage with respect
to mental health and substance use disorder
benefits by substituting for the applicable
lifetime limit an average aggregate lifetime
limit that is computed taking into account the
weighted average of the aggregate lifetime
limits applicable to such categories.
(2) Annual limits.--In the case of a group health
plan or a health insurance issuer offering group or
individual health insurance coverage that provides both
medical and surgical benefits and mental health or
substance use disorder benefits--
(A) No annual limit.--If the plan or coverage
does not include an annual limit on
substantially all medical and surgical
benefits, the plan or coverage may not impose
any annual limit on mental health or substance
use disorder benefits.
(B) Annual limit.--If the plan or coverage
includes an annual limit on substantially all
medical and surgical benefits (in this
paragraph referred to as the ``applicable
annual limit''), the plan or coverage shall
either--
(i) apply the applicable annual limit
both to medical and surgical benefits
to which it otherwise would apply and
to mental health and substance use
disorder benefits and not distinguish
in the application of such limit
between such medical and surgical
benefits and mental health and
substance use disorder benefits; or
(ii) not include any annual limit on
mental health or substance use disorder
benefits that is less than the
applicable annual limit.
(C) Rule in case of different limits.--In the
case of a plan or coverage that is not
described in subparagraph (A) or (B) and that
includes no or different annual limits on
different categories of medical and surgical
benefits, the Secretary shall establish rules
under which subparagraph (B) is applied to such
plan or coverage with respect to mental health
and substance use disorder benefits by
substituting for the applicable annual limit an
average annual limit that is computed taking
into account the weighted average of the annual
limits applicable to such categories.
(3) Financial requirements and treatment
limitations.--
(A) In general.--In the case of a group
health plan or a health insurance issuer
offering group or individual health insurance
coverage that provides both medical and
surgical benefits and mental health or
substance use disorder benefits, such plan or
coverage shall ensure that--
(i) the financial requirements
applicable to such mental health or
substance use disorder benefits are no
more restrictive than the predominant
financial requirements applied to
substantially all medical and surgical
benefits covered by the plan (or
coverage), and there are no separate
cost sharing requirements that are
applicable only with respect to mental
health or substance use disorder
benefits; and
(ii) the treatment limitations
applicable to such mental health or
substance use disorder benefits are no
more restrictive than the predominant
treatment limitations applied to
substantially all medical and surgical
benefits covered by the plan (or
coverage) and there are no separate
treatment limitations that are
applicable only with respect to mental
health or substance use disorder
benefits.
(B) Definitions.--In this paragraph:
(i) Financial requirement.--The term
``financial requirement'' includes
deductibles, copayments, coinsurance,
and out-of-pocket expenses, but
excludes an aggregate lifetime limit
and an annual limit subject to
paragraphs (1) and (2).
(ii) Predominant.--A financial
requirement or treatment limit is
considered to be predominant if it is
the most common or frequent of such
type of limit or requirement.
(iii) Treatment limitation.--The term
``treatment limitation'' includes
limits on the frequency of treatment,
number of visits, days of coverage, or
other similar limits on the scope or
duration of treatment.
(4) Availability of plan information.--The criteria
for medical necessity determinations made under the
plan with respect to mental health or substance use
disorder benefits (or the health insurance coverage
offered in connection with the plan with respect to
such benefits) shall be made available by the plan
administrator (or the health insurance issuer offering
such coverage) in accordance with regulations to any
current or potential participant, beneficiary, or
contracting provider upon request. The reason for any
denial under the plan (or coverage) of reimbursement or
payment for services with respect to mental health or
substance use disorder benefits in the case of any
participant or beneficiary shall, on request or as
otherwise required, be made available by the plan
administrator (or the health insurance issuer offering
such coverage) to the participant or beneficiary in
accordance with regulations.
(5) Out-of-network providers.--In the case of a plan
or coverage that provides both medical and surgical
benefits and mental health or substance use disorder
benefits, if the plan or coverage provides coverage for
medical or surgical benefits provided by out-of-network
providers, the plan or coverage shall provide coverage
for mental health or substance use disorder benefits
provided by out-of-network providers in a manner that
is consistent with the requirements of this section.
(6) Compliance program guidance document.--
(A) In general.--Not later than 12 months
after the date of enactment of the Helping
Families in Mental Health Crisis Reform Act of
2016, the Secretary, the Secretary of Labor,
and the Secretary of the Treasury, in
consultation with the Inspector General of the
Department of Health and Human Services, the
Inspector General of the Department of Labor,
and the Inspector General of the Department of
the Treasury, shall issue a compliance program
guidance document to help improve compliance
with this section, section 712 of the Employee
Retirement Income Security Act of 1974, and
section 9812 of the Internal Revenue Code of
1986, as applicable. In carrying out this
paragraph, the Secretaries may take into
consideration the 2016 publication of the
Department of Health and Human Services and the
Department of Labor, entitled ``Warning Signs -
Plan or Policy Non-Quantitative Treatment
Limitations (NQTLs) that Require Additional
Analysis to Determine Mental Health Parity
Compliance''.
(B) Examples illustrating compliance and
noncompliance.--
(i) In general.--The compliance
program guidance document required
under this paragraph shall provide
illustrative, de-identified examples
(that do not disclose any protected
health information or individually
identifiable information) of previous
findings of compliance and
noncompliance with this section,
section 712 of the Employee Retirement
Income Security Act of 1974, or section
9812 of the Internal Revenue Code of
1986, as applicable, based on
investigations of violations of such
sections, including--
(I) examples illustrating
requirements for information
disclosures and nonquantitative
treatment limitations; and
(II) descriptions of the
violations uncovered during the
course of such investigations.
(ii) Nonquantitative treatment
limitations.--To the extent that any
example described in clause (i)
involves a finding of compliance or
noncompliance with regard to any
requirement for nonquantitative
treatment limitations, the example
shall provide sufficient detail to
fully explain such finding, including a
full description of the criteria
involved for approving medical and
surgical benefits and the criteria
involved for approving mental health
and substance use disorder benefits.
(iii) Access to additional
information regarding compliance.--In
developing and issuing the compliance
program guidance document required
under this paragraph, the Secretaries
specified in subparagraph (A)--
(I) shall enter into
interagency agreements with the
Inspector General of the
Department of Health and Human
Services, the Inspector General
of the Department of Labor, and
the Inspector General of the
Department of the Treasury to
share findings of compliance
and noncompliance with this
section, section 712 of the
Employee Retirement Income
Security Act of 1974, or
section 9812 of the Internal
Revenue Code of 1986, as
applicable; and
(II) shall seek to enter into
an agreement with a State to
share information on findings
of compliance and noncompliance
with this section, section 712
of the Employee Retirement
Income Security Act of 1974, or
section 9812 of the Internal
Revenue Code of 1986, as
applicable.
(C) Recommendations.--The compliance program
guidance document shall include recommendations
to advance compliance with this section,
section 712 of the Employee Retirement Income
Security Act of 1974, or section 9812 of the
Internal Revenue Code of 1986, as applicable,
and encourage the development and use of
internal controls to monitor adherence to
applicable statutes, regulations, and program
requirements. Such internal controls may
include illustrative examples of
nonquantitative treatment limitations on mental
health and substance use disorder benefits,
which may fail to comply with this section,
section 712 of the Employee Retirement Income
Security Act of 1974, or section 9812 of the
Internal Revenue Code of 1986, as applicable,
in relation to nonquantitative treatment
limitations on medical and surgical benefits.
(D) Updating the compliance program guidance
document.--The Secretary, the Secretary of
Labor, and the Secretary of the Treasury, in
consultation with the Inspector General of the
Department of Health and Human Services, the
Inspector General of the Department of Labor,
and the Inspector General of the Department of
the Treasury, shall update the compliance
program guidance document every 2 years to
include illustrative, de-identified examples
(that do not disclose any protected health
information or individually identifiable
information) of previous findings of compliance
and noncompliance with this section, section
712 of the Employee Retirement Income Security
Act of 1974, or section 9812 of the Internal
Revenue Code of 1986, as applicable.
(7) Additional guidance.--
(A) In general.--Not later than 12 months
after the date of enactment of the Helping
Families in Mental Health Crisis Reform Act of
2016, the Secretary, the Secretary of Labor,
and the Secretary of the Treasury shall issue
guidance to group health plans and health
insurance issuers offering group or individual
health insurance coverage to assist such plans
and issuers in satisfying the requirements of
this section, section 712 of the Employee
Retirement Income Security Act of 1974, or
section 9812 of the Internal Revenue Code of
1986, as applicable.
(B) Disclosure.--
(i) Guidance for plans and issuers.--
The guidance issued under this
paragraph shall include clarifying
information and illustrative examples
of methods that group health plans and
health insurance issuers offering group
or individual health insurance coverage
may use for disclosing information to
ensure compliance with the requirements
under this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 9812 of the
Internal Revenue Code of 1986, as
applicable, (and any regulations
promulgated pursuant to such sections,
as applicable).
(ii) Documents for participants,
beneficiaries, contracting providers,
or authorized representatives.--The
guidance issued under this paragraph
shall include clarifying information
and illustrative examples of methods
that group health plans and health
insurance issuers offering group or
individual health insurance coverage
may use to provide any participant,
beneficiary, contracting provider, or
authorized representative, as
applicable, with documents containing
information that the health plans or
issuers are required to disclose to
participants, beneficiaries,
contracting providers, or authorized
representatives to ensure compliance
with this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 9812 of the
Internal Revenue Code of 1986, as
applicable, compliance with any
regulation issued pursuant to such
respective section, or compliance with
any other applicable law or regulation.
Such guidance shall include information
that is comparative in nature with
respect to--
(I) nonquantitative treatment
limitations for both medical
and surgical benefits and
mental health and substance use
disorder benefits;
(II) the processes,
strategies, evidentiary
standards, and other factors
used to apply the limitations
described in subclause (I); and
(III) the application of the
limitations described in
subclause (I) to ensure that
such limitations are applied in
parity with respect to both
medical and surgical benefits
and mental health and substance
use disorder benefits.
(C) Nonquantitative treatment limitations.--
The guidance issued under this paragraph shall
include clarifying information and illustrative
examples of methods, processes, strategies,
evidentiary standards, and other factors that
group health plans and health insurance issuers
offering group or individual health insurance
coverage may use regarding the development and
application of nonquantitative treatment
limitations to ensure compliance with this
section, section 712 of the Employee Retirement
Income Security Act of 1974, or section 9812 of
the Internal Revenue Code of 1986, as
applicable, (and any regulations promulgated
pursuant to such respective section),
including--
(i) examples of methods of
determining appropriate types of
nonquantitative treatment limitations
with respect to both medical and
surgical benefits and mental health and
substance use disorder benefits,
including nonquantitative treatment
limitations pertaining to--
(I) medical management
standards based on medical
necessity or appropriateness,
or whether a treatment is
experimental or investigative;
(II) limitations with respect
to prescription drug formulary
design; and
(III) use of fail-first or
step therapy protocols;
(ii) examples of methods of
determining--
(I) network admission
standards (such as
credentialing); and
(II) factors used in provider
reimbursement methodologies
(such as service type,
geographic market, demand for
services, and provider supply,
practice size, training,
experience, and licensure) as
such factors apply to network
adequacy;
(iii) examples of sources of
information that may serve as
evidentiary standards for the purposes
of making determinations regarding the
development and application of
nonquantitative treatment limitations;
(iv) examples of specific factors,
and the evidentiary standards used to
evaluate such factors, used by such
plans or issuers in performing a
nonquantitative treatment limitation
analysis;
(v) examples of how specific
evidentiary standards may be used to
determine whether treatments are
considered experimental or
investigative;
(vi) examples of how specific
evidentiary standards may be applied to
each service category or classification
of benefits;
(vii) examples of methods of reaching
appropriate coverage determinations for
new mental health or substance use
disorder treatments, such as evidence-
based early intervention programs for
individuals with a serious mental
illness and types of medical management
techniques;
(viii) examples of methods of
reaching appropriate coverage
determinations for which there is an
indirect relationship between the
covered mental health or substance use
disorder benefit and a traditional
covered medical and surgical benefit,
such as residential treatment or
hospitalizations involving voluntary or
involuntary commitment; and
(ix) additional illustrative examples
of methods, processes, strategies,
evidentiary standards, and other
factors for which the Secretary
determines that additional guidance is
necessary to improve compliance with
this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 9812 of the
Internal Revenue Code of 1986, as
applicable.
(D) Public comment.--Prior to issuing any
final guidance under this paragraph, the
Secretary shall provide a public comment period
of not less than 60 days during which any
member of the public may provide comments on a
draft of the guidance.
(b) Construction.--Nothing in this section shall be
construed--
(1) as requiring a group health plan or a health
insurance issuer offering group or individual health
insurance coverage to provide any mental health or
substance use disorder benefits; or
(2) in the case of a group health plan or a health
insurance issuer offering group or individual health
insurance coverage that provides mental health or
substance use disorder benefits, as affecting the terms
and conditions of the plan or coverage relating to such
benefits under the plan or coverage, except as provided
in subsection (a).
(c) Exemptions.--
(1) Small employer exemption.--This section shall not
apply to any group health plan and a health insurance
issuer offering group or individual health insurance
coverage for any plan year of a small employer (as
defined in section 2791(e)(4), except that for purposes
of this paragraph such term shall include employers
with 1 employee in the case of an employer residing in
a State that permits small groups to include a single
individual).
(2) Cost exemption.--
(A) In general.--With respect to a group
health plan or a health insurance issuer
offering group or individual health insurance
coverage, if the application of this section to
such plan (or coverage) results in an increase
for the plan year involved of the actual total
costs of coverage with respect to medical and
surgical benefits and mental health and
substance use disorder benefits under the plan
(as determined and certified under subparagraph
(C)) by an amount that exceeds the applicable
percentage described in subparagraph (B) of the
actual total plan costs, the provisions of this
section shall not apply to such plan (or
coverage) during the following plan year, and
such exemption shall apply to the plan (or
coverage) for 1 plan year. An employer may
elect to continue to apply mental health and
substance use disorder parity pursuant to this
section with respect to the group health plan
(or coverage) involved regardless of any
increase in total costs.
(B) Applicable percentage.--With respect to a
plan (or coverage), the applicable percentage
described in this subparagraph shall be--
(i) 2 percent in the case of the
first plan year in which this section
is applied; and
(ii) 1 percent in the case of each
subsequent plan year.
(C) Determinations by actuaries.--
Determinations as to increases in actual costs
under a plan (or coverage) for purposes of this
section shall be made and certified by a
qualified and licensed actuary who is a member
in good standing of the American Academy of
Actuaries. All such determinations shall be in
a written report prepared by the actuary. The
report, and all underlying documentation relied
upon by the actuary, shall be maintained by the
group health plan or health insurance issuer
for a period of 6 years following the
notification made under subparagraph (E).
(D) 6-month determinations.--If a group
health plan (or a health insurance issuer
offering coverage in connection with a group
health plan) seeks an exemption under this
paragraph, determinations under subparagraph
(A) shall be made after such plan (or coverage)
has complied with this section for the first 6
months of the plan year involved.
(E) Notification.--
(i) In general.--A group health plan
(or a health insurance issuer offering
coverage in connection with a group
health plan) that, based upon a
certification described under
subparagraph (C), qualifies for an
exemption under this paragraph, and
elects to implement the exemption,
shall promptly notify the Secretary,
the appropriate State agencies, and
participants and beneficiaries in the
plan of such election.
(ii) Requirement.--A notification to
the Secretary under clause (i) shall
include--
(I) a description of the
number of covered lives under
the plan (or coverage) involved
at the time of the
notification, and as
applicable, at the time of any
prior election of the cost-
exemption under this paragraph
by such plan (or coverage);
(II) for both the plan year
upon which a cost exemption is
sought and the year prior, a
description of the actual total
costs of coverage with respect
to medical and surgical
benefits and mental health and
substance use disorder benefits
under the plan; and
(III) for both the plan year
upon which a cost exemption is
sought and the year prior, the
actual total costs of coverage
with respect to mental health
and substance use disorder
benefits under the plan.
(iii) Confidentiality.--A
notification to the Secretary under
clause (i) shall be confidential. The
Secretary shall make available, upon
request and on not more than an annual
basis, an anonymous itemization of such
notifications, that includes--
(I) a breakdown of States by
the size and type of employers
submitting such notification;
and
(II) a summary of the data
received under clause (ii).
(F) Audits by appropriate agencies.--To
determine compliance with this paragraph, the
Secretary may audit the books and records of a
group health plan or health insurance issuer
relating to an exemption, including any
actuarial reports prepared pursuant to
subparagraph (C), during the 6 year period
following the notification of such exemption
under subparagraph (E). A State agency
receiving a notification under subparagraph (E)
may also conduct such an audit with respect to
an exemption covered by such notification.
(d) Separate Application to Each Option Offered.--In the case
of a group health plan that offers a participant or beneficiary
two or more benefit package options under the plan, the
requirements of this section shall be applied separately with
respect to each such option.
(e) Definitions.--For purposes of this section--
(1) Aggregate lifetime limit.--The term ``aggregate
lifetime limit'' means, with respect to benefits under
a group health plan or health insurance coverage, a
dollar limitation on the total amount that may be paid
with respect to such benefits under the plan or health
insurance coverage with respect to an individual or
other coverage unit.
(2) Annual limit.--The term ``annual limit'' means,
with respect to benefits under a group health plan or
health
insurance coverage, a dollar limitation on the total
amount of benefits that may be paid with respect to
such benefits in a 12-month period under the plan or
health insurance coverage with respect to an individual
or other coverage unit.
(3) Medical or surgical benefits.--The term ``medical
or surgical benefits'' means benefits with respect to
medical or surgical services, as defined under the
terms of the plan or coverage (as the case may be), but
does not include mental health or substance use
disorder benefits.
(4) Mental health benefits.--The term ``mental health
benefits'' means benefits with respect to services for
mental health conditions, as defined under the terms of
the plan and in accordance with applicable Federal and
State law.
(5) Substance use disorder benefits.--The term
``substance use disorder benefits'' means benefits with
respect to services for substance use disorders, as
defined under the terms of the plan and in accordance
with applicable Federal and State law.
(f) Sunset.--The provisions of this section shall have no
force or effect after the date of the enactment of the
Strengthening Behavioral Health Parity Act.
* * * * * * *
Subpart 2--Exclusion of Plans; Enforcement; Preemption
SEC. 2722. EXCLUSION OF CERTAIN PLANS.
(a) Limitation on Application of Provisions Relating to Group
Health Plans.--
(1) In general.--The requirements of subparts 1 and 2
and part D shall apply with respect to group health
plans only--
(A) subject to paragraph (2), in the case of
a plan that is a nonfederal governmental plan,
and
(B) with respect to health insurance coverage
offered in connection with a group health plan
(including such a plan that is a church plan or
a governmental plan).
(2) Treatment of nonfederal governmental plans.--
(A) Election to be excluded.--Except as
provided in subparagraph (D) or (E), if the
plan sponsor of a nonfederal governmental plan
which is a group health plan to which the
provisions of subparts 1 and 2 otherwise apply
makes an election under this subparagraph (in
such form and manner as the Secretary may by
regulations prescribe), then the requirements
of such subparts insofar as they apply directly
to group health plans (and not merely to group
health insurance coverage) shall not apply to
such governmental plans for such period except
as provided in this paragraph.
(B) Period of election.--An election under
subparagraph (A) shall apply--
(i) for a single specified plan year,
or
(ii) in the case of a plan provided
pursuant to a collective bargaining
agreement, for the term of such
agreement.
An election under clause (i) may be extended
through subsequent elections under this
paragraph.
(C) Notice to enrollees.--Under such an
election, the plan shall provide for--
(i) notice to enrollees (on an annual
basis and at the time of enrollment
under the plan) of the fact and
consequences of such election, and
(ii) certification and disclosure of
creditable coverage under the plan with
respect to enrollees in accordance with
section 2701(e).
(D) Election not applicable to requirements
concerning genetic information.--The election
described in subparagraph (A) shall not be
available with respect to the provisions of
subsections (a)(1)(F), (b)(3), (c), and (d) of
section 2702 and the provisions of sections
2701 and 2702(b) to the extent that such
provisions apply to genetic information.
(E) Election not applicable.--The election
described in subparagraph (A) shall not be
available with respect to the provisions of
subparts I and II.
(b) Exception for Certain Benefits.--The requirements of
subparts 1 and 2 and part D shall not apply to any individual
coverage or any group health plan (or group health insurance
coverage) in relation to its provision of excepted benefits
described in section 2791(c)(1).
(c) Exception for Certain Benefits If Certain Conditions
Met.--
(1) Limited, excepted benefits.--The requirements of
subparts 1 and 2 and part D shall not apply to any
individual coverage or any group health plan (and group
health insurance coverage offered in connection with a
group health plan) in relation to its provision of
excepted benefits described in section 2791(c)(2) if
the benefits--
(A) are provided under a separate policy,
certificate, or contract of insurance; or
(B) are otherwise not an integral part of the
plan.
(2) Noncoordinated, excepted benefits.--The
requirements of subparts 1 and 2 and part D shall not
apply to any individual coverage or any group health
plan (and group health insurance coverage offered in
connection with a group health plan) in relation to its
provision of excepted benefits described in section
2791(c)(3) if all of the following conditions are met:
(A) The benefits are provided under a
separate policy, certificate, or contract of
insurance.
(B) There is no coordination between the
provision of such benefits and any exclusion of
benefits under any group health plan maintained
by the same plan sponsor.
(C) Such benefits are paid with respect to an
event without regard to whether benefits are
provided with respect to such an event under
any group health plan maintained by the same
plan sponsor or, with respect to individual
coverage, under any health insurance coverage
maintained by the same health insurance issuer.
(3) Supplemental excepted benefits.--The requirements
of this part and part D shall not apply to any
individual coverage or any group health plan (and group
health insurance coverage) in relation to its provision
of excepted benefits described in section 27971(c)(4)
if the benefits are provided under a separate policy,
certificate, or contract of insurance.
(d) Treatment of Partnerships.--For purposes of this part and
part D--
(1) Treatment as a group health plan.--Any plan,
fund, or program which would not be (but for this
subsection) an employee welfare benefit plan and which
is established or maintained by a partnership, to the
extent that such plan, fund, or program provides
medical care (including items and services paid for as
medical care) to present or former partners in the
partnership or to their dependents (as defined under
the terms of the plan, fund, or program), directly or
through insurance, reimbursement, or otherwise, shall
be treated (subject to paragraph (2)) as an employee
welfare benefit plan which is a group health plan.
(2) Employer.--In the case of a group health plan,
the term ``employer'' also includes the partnership in
relation to any partner.
(3) Participants of group health plans.--In the case
of a group health plan, the term ``participant'' also
includes--
(A) in connection with a group health plan
maintained by a partnership, an individual who
is a partner in relation to the partnership, or
(B) in connection with a group health plan
maintained by a self-employed individual (under
which one or more employees are participants),
the self-employed individual,
if such individual is, or may become, eligible to
receive a benefit under the plan or such individual's
beneficiaries may be eligible to receive any such
benefit.
SEC. 2723. ENFORCEMENT.
(a) State Enforcement.--
(1) State authority.--Subject to section 2723, each
State may require that health insurance issuers that
issue, sell, renew, or offer health insurance coverage
in the State in the individual or group market meet the
requirements of this part and part D with respect to
such issuers.
(2) Failure to implement provisions.--In the case of
a determination by the Secretary that a State has
failed to substantially enforce a provision (or
provisions) in this part or part D with respect to
health insurance issuers in the State, the Secretary
shall enforce such provision (or provisions) under
subsection (b) insofar as they relate to the issuance,
sale, renewal, and offering of health insurance
coverage in connection with group health plans or
individual health insurance coverage in such State.
(b) Secretarial Enforcement Authority.--
(1) Limitation.--The provisions of this subsection
shall apply to enforcement of a provision (or
provisions) of this part or part D only--
(A) as provided under subsection (a)(2); and
(B) with respect to individual health
insurance coverage or group health plans that
are non-Federal governmental plans.
(2) Imposition of penalties.--In the cases described
in paragraph (1)--
(A) In general.--Subject to the succeeding
provisions of this subsection, any non-Federal
governmental plan that is a group health plan
and any health insurance issuer that fails to
meet a provision of this part or part D
applicable to such plan or issuer is subject to
a civil money penalty under this subsection.
(B) Liability for penalty.--In the case of a
failure by--
(i) a health insurance issuer, the
issuer is liable for such penalty, or
(ii) a group health plan that is a
non-Federal governmental plan which
is--
(I) sponsored by 2 or more
employers, the plan is liable
for such penalty, or
(II) not so sponsored, the
employer is liable for such
penalty.
(C) Amount of penalty.--
(i) In general.--The maximum amount
of penalty imposed under this paragraph
is $100 for each day for each
individual with respect to which such a
failure occurs.
(ii) Considerations in imposition.--
In determining the amount of any
penalty to be assessed under this
paragraph, the Secretary shall take
into account the previous record of
compliance of the entity being assessed
with the applicable provisions of this
part and part D and the gravity of the
violation.
(iii) Limitations.--
(I) Penalty not to apply
where failure not discovered
exercising reasonable
diligence.--No civil money
penalty shall be imposed under
this paragraph on any failure
during any period for which it
is established to the
satisfaction of the Secretary
that none of the entities
against whom the penalty would
be imposed knew, or exercising
reasonable diligence would have
known, that such failure
existed.
(II) Penalty not to apply to
failures corrected within 30
days.--No civil money penalty
shall be imposed under this
paragraph on any failure if
such failure was due to
reasonable cause and not to
willful neglect, and such
failure is corrected during the
30-day period beginning on the
first day any of the entities
against whom the penalty would
be imposed knew, or exercising
reasonable diligence would have
known, that such failure
existed.
(D) Administrative review.--
(i) Opportunity for hearing.--The
entity assessed shall be afforded an
opportunity for hearing by the
Secretary upon request made within 30
days after the date of the issuance of
a notice of assessment. In such hearing
the decision shall be made on the
record pursuant to section 554 of title
5, United States Code. If no hearing is
requested, the assessment shall
constitute a final and unappealable
order.
(ii) Hearing procedure.--If a hearing
is requested, the initial agency
decision shall be made by an
administrative law judge, and such
decision shall become the final order
unless the Secretary modifies or
vacates the decision. Notice of intent
to modify or vacate the decision of the
administrative law judge shall be
issued to the parties within 30 days
after the date of the decision of the
judge. A final order which takes effect
under this paragraph shall be
subject to review only as provided
under subparagraph (E).
(E) Judicial review.--
(i) Filing of action for review.--Any
entity against whom an order imposing a
civil money penalty has been entered
after an agency hearing under this
paragraph may obtain review by the
United States district court for any
district in which such entity is
located or the United States District
Court for the District of Columbia by
filing a notice of appeal in such court
within 30 days from the date of such
order, and simultaneously sending a
copy of such notice by registered mail
to the Secretary.
(ii) Certification of administrative
record.--The Secretary shall promptly
certify and file in such court the
record upon which the penalty was
imposed.
(iii) Standard for review.--The
findings of the Secretary shall be set
aside only if found to be unsupported
by substantial evidence as provided by
section 706(2)(E) of title 5, United
States Code.
(iv) Appeal.--Any final decision,
order, or judgment of the district
court concerning such review shall be
subject to appeal as provided in
chapter 83 of title 28 of such Code.
(F) Failure to pay assessment; maintenance of
action.--
(i) Failure to pay assessment.--If
any entity fails to pay an assessment
after it has become a final and
unappealable order, or after the court
has entered final judgment in favor of
the Secretary, the Secretary shall
refer the matter to the Attorney
General who shall recover the amount
assessed by action in the appropriate
United States district court.
(ii) Nonreviewability.--In such
action the validity and appropriateness
of the final order imposing the penalty
shall not be subject to review.
(G) Payment of penalties.--Except as
otherwise provided, penalties collected under
this paragraph shall be paid to the Secretary
(or other officer) imposing the penalty and
shall be available without appropriation and
until expended for the purpose of enforcing the
provisions with respect to which the penalty
was imposed.
(3) Enforcement authority relating to genetic
discrimination.--
(A) General rule.--In the cases described in
paragraph (1), notwithstanding the provisions
of paragraph (2)(C), the succeeding
subparagraphs of this paragraph shall apply
with respect to an action under this subsection
by the Secretary with respect to any failure of
a health insurance issuer in connection with a
group health plan, to meet the requirements of
subsection (a)(1)(F), (b)(3), (c), or (d) of
section 2702 or section 2701 or 2702(b)(1) with
respect to genetic information in connection
with the plan.
(B) Amount.--
(i) In general.--The amount of the
penalty imposed under this paragraph
shall be $100 for each day in the
noncompliance period with respect to
each participant or beneficiary to whom
such failure relates.
(ii) Noncompliance period.--For
purposes of this paragraph, the term
``noncompliance period'' means, with
respect to any failure, the period--
(I) beginning on the date
such failure first occurs; and
(II) ending on the date the
failure is corrected.
(C) Minimum penalties where failure
discovered.--Notwithstanding clauses (i) and
(ii) of subparagraph (D):
(i) In general.--In the case of 1 or
more failures with respect to an
individual--
(I) which are not corrected
before the date on which the
plan receives a notice from the
Secretary of such violation;
and
(II) which occurred or
continued during the period
involved;
the amount of penalty imposed by
subparagraph (A) by reason of such
failures with respect to such
individual shall not be less than
$2,500.
(ii) Higher minimum penalty where
violations are more than de minimis.--
To the extent violations for which any
person is liable under this paragraph
for any year are more than de minimis,
clause (i) shall be applied by
substituting ``$15,000'' for ``$2,500''
with respect to such person.
(D) Limitations.--
(i) Penalty not to apply where
failure not discovered exercising
reasonable diligence.--No penalty shall
be imposed by subparagraph (A) on any
failure during any period for which it
is established to the satisfaction of
the Secretary that the person otherwise
liable for such penalty did not know,
and exercising reasonable diligence
would not have known, that such failure
existed.
(ii) Penalty not to apply to failures
corrected within certain periods.--No
penalty shall be imposed by
subparagraph (A) on any failure if--
(I) such failure was due to
reasonable cause and not to
willful neglect; and
(II) such failure is
corrected during the 30-day
period beginning on the first
date the person otherwise
liable for such penalty knew,
or exercising reasonable
diligence would have known,
that such failure existed.
(iii) Overall limitation for
unintentional failures.--In the case of
failures which are due to reasonable
cause and not to willful neglect, the
penalty imposed by subparagraph (A) for
failures shall not exceed the amount
equal to the lesser of--
(I) 10 percent of the
aggregate amount paid or
incurred by the employer (or
predecessor employer) during
the preceding taxable year for
group health plans; or
(II) $500,000.
(E) Waiver by secretary.--In the case of a
failure which is due to reasonable cause and
not to willful neglect, the Secretary may waive
part or all of the penalty imposed by
subparagraph (A) to the extent that the payment
of such penalty would be excessive relative to
the failure involved.
SEC. 2724. PREEMPTION; STATE FLEXIBILITY; CONSTRUCTION.
(a) Continued Applicability of State Law With Respect to
Health Insurance Issuers.--
(1) In General.--Subject to paragraph (2) and except
as provided in subsection (b), [this part and part C
insofar as it relates to this part] this part, part D,
and part C insofar as it relates to this part or part D
shall not be construed to supersede any provision of
State law which establishes, implements, or continues
in effect any standard or requirement solely relating
to health insurance issuers in connection with
individual or group health insurance coverage except to
the extent that such standard or requirement prevents
the application of a requirement of this part or part
D.
(2) Continued preemption with respect to group health
plans.--Nothing in this part or part D shall be
construed to affect or modify the provisions of section
514 of the Employee Retirement Income Security Act of
1974 with respect to group health plans.
(b) Special Rules in Case of Portability Requirements.--
(1) In general.--Subject to paragraph (2), the
provisions of this part relating to health insurance
coverage offered by a health insurance issuer supersede
any provision of State law which establishes,
implements, or continues in effect a standard or
requirement applicable to imposition of a preexisting
condition exclusion specifically governed by section
701 which differs from the standards or requirements
specified in such section.
(2) Exceptions.--Only in relation to health insurance
coverage offered by a health insurance issuer, the
provisions of this part do not supersede any provision
of State law to the extent that such provision--
(i) substitutes for the reference to ``6-
month period'' in section 2701(a)(1) a
reference to any shorter period of time;
(ii) substitutes for the reference to ``12
months'' and ``18 months'' in section
2701(a)(2) a reference to any shorter period of
time;
(iii) substitutes for the references to
``63'' days in sections 2701(c)(2)(A) and
2701(d)(4)(A) a reference to any greater number
of days;
(iv) substitutes for the reference to ``30-
day period'' in sections 2701(b)(2) and
2701(d)(1) a reference to any greater period;
(v) prohibits the imposition of any
preexisting condition exclusion in cases not
described in section 2701(d) or expands the
exceptions described in such section;
(vi) requires special enrollment periods in
addition to those required under section
2701(f); or
(vii) reduces the maximum period permitted in
an affiliation period under section
2701(g)(1)(B).
(c) Rules of Construction.--Nothing in this part (other than
section 2704) or part D shall be construed as requiring a group
health plan or health insurance coverage to provide specific
benefits under the terms of such plan or coverage.
(d) Definitions.--For purposes of this section--
(1) State law.--The term ``State law'' includes all
laws, decisions, rules, regulations, or other State
action having the effect of law, of any State. A law of
the United States applicable only to the District of
Columbia shall be treated as a State law rather than a
law of the United States.
(2) State.--The term ``State'' includes a State
(including the Northern Mariana Islands), any political
subdivisions of a State or such Islands, or any agency
or instrumentality of either.
* * * * * * *
PART D--ADDITIONAL COVERAGE PROVISIONS
SEC. 2799A-1. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DISORDER
BENEFITS.
(a) In General.--
(1) Aggregate lifetime limits.--In the case of a
group health plan or a health insurance issuer offering
group or individual health insurance coverage that
provides both medical and surgical benefits and mental
health or substance use disorder benefits--
(A) No lifetime limit.--If the plan or
coverage does not include an aggregate lifetime
limit on substantially all medical and surgical
benefits, the plan or coverage may not impose
any aggregate lifetime limit on mental health
or substance use disorder benefits.
(B) Lifetime limit.--If the plan or coverage
includes an aggregate lifetime limit on
substantially all medical and surgical benefits
(in this paragraph referred to as the
``applicable lifetime limit''), the plan or
coverage shall either--
(i) apply the applicable lifetime
limit both to the medical and surgical
benefits to which it otherwise would
apply and to mental health and
substance use disorder benefits and not
distinguish in the application of such
limit between such medical and surgical
benefits and mental health and
substance use disorder benefits; or
(ii) not include any aggregate
lifetime limit on mental health or
substance use disorder benefits that is
less than the applicable lifetime
limit.
(C) Rule in case of different limits.--In the
case of a plan or coverage that is not
described in subparagraph (A) or (B) and that
includes no or different aggregate lifetime
limits on different categories of medical and
surgical benefits, the Secretary shall
establish rules under which subparagraph (B) is
applied to such plan or coverage with respect
to mental health and substance use disorder
benefits by substituting for the applicable
lifetime limit an average aggregate lifetime
limit that is computed taking into account the
weighted average of the aggregate lifetime
limits applicable to such categories.
(2) Annual limits.--In the case of a group health
plan or a health insurance issuer offering group or
individual health insurance coverage that provides both
medical and surgical benefits and mental health or
substance use disorder benefits--
(A) No annual limit.--If the plan or coverage
does not include an annual limit on
substantially all medical and surgical
benefits, the plan or coverage may not impose
any annual limit on mental health or substance
use disorder benefits.
(B) Annual limit.--If the plan or coverage
includes an annual limit on substantially all
medical and surgical benefits (in this
paragraph referred to as the ``applicable
annual limit''), the plan or coverage shall
either--
(i) apply the applicable annual limit
both to medical and surgical benefits
to which it otherwise would apply and
to mental health and substance use
disorder benefits and not distinguish
in the application of such limit
between such medical and surgical
benefits and mental health and
substance use disorder benefits; or
(ii) not include any annual limit on
mental health or substance use disorder
benefits that is less than the
applicable annual limit.
(C) Rule in case of different limits.--In the
case of a plan or coverage that is not
described in subparagraph (A) or (B) and that
includes no or different annual limits on
different categories of medical and surgical
benefits, the Secretary shall establish rules
under which subparagraph (B) is applied to such
plan or coverage with respect to mental health
and substance use disorder benefits by
substituting for the applicable annual limit an
average annual limit that is computed taking
into account the weighted average of the annual
limits applicable to such categories.
(3) Financial requirements and treatment
limitations.--
(A) In general.--In the case of a group
health plan or a health insurance issuer
offering group or individual health insurance
coverage that provides both medical and
surgical benefits and mental health or
substance use disorder benefits, such plan or
coverage shall ensure that--
(i) the financial requirements
applicable to such mental health or
substance use disorder benefits are no
more restrictive than the predominant
financial requirements applied to
substantially all medical and surgical
benefits covered by the plan (or
coverage), and there are no separate
cost sharing requirements that are
applicable only with respect to mental
health or substance use disorder
benefits; and
(ii) the treatment limitations
applicable to such mental health or
substance use disorder benefits are no
more restrictive than the predominant
treatment limitations applied to
substantially all medical and surgical
benefits covered by the plan (or
coverage) and there are no separate
treatment limitations that are
applicable only with respect to mental
health or substance use disorder
benefits.
(B) Definitions.--In this paragraph:
(i) Financial requirement.--The term
``financial requirement'' includes
deductibles, copayments, coinsurance,
and out-of-pocket expenses, but
excludes an aggregate lifetime limit
and an annual limit subject to
paragraphs (1) and (2).
(ii) Predominant.--A financial
requirement or treatment limit is
considered to be predominant if it is
the most common or frequent of such
type of limit or requirement.
(iii) Treatment limitation.--The term
``treatment limitation'' includes
limits on the frequency of treatment,
number of visits, days of coverage, or
other similar limits on the scope or
duration of treatment.
(4) Availability of plan information.--The criteria
for medical necessity determinations made under the
plan with respect to mental health or substance use
disorder benefits (or the health insurance coverage
offered in connection with the plan with respect to
such benefits) shall be made available by the plan
administrator (or the health insurance issuer offering
such coverage) in accordance with regulations to any
current or potential participant, beneficiary, or
contracting provider upon request. The reason for any
denial under the plan (or coverage) of reimbursement or
payment for services with respect to mental health or
substance use disorder benefits in the case of any
participant or beneficiary shall, on request or as
otherwise required, be made available by the plan
administrator (or the health insurance issuer offering
such coverage) to the participant or beneficiary in
accordance with regulations.
(5) Out-of-network providers.--In the case of a plan
or coverage that provides both medical and surgical
benefits and mental health or substance use disorder
benefits, if the plan or coverage provides coverage for
medical or surgical benefits provided by out-of-network
providers, the plan or coverage shall provide coverage
for mental health or substance use disorder benefits
provided by out-of-network providers in a manner that
is consistent with the requirements of this section.
(6) Compliance program guidance document.--
(A) In general.--Not later than 12 months
after the date of enactment of the Helping
Families in Mental Health Crisis Reform Act of
2016, the Secretary, the Secretary of Labor,
and the Secretary of the Treasury, in
consultation with the Inspector General of the
Department of Health and Human Services, the
Inspector General of the Department of Labor,
and the Inspector General of the Department of
the Treasury, shall issue a compliance program
guidance document to help improve compliance
with this section, section 712 of the Employee
Retirement Income Security Act of 1974, and
section 9812 of the Internal Revenue Code of
1986, as applicable. In carrying out this
paragraph, the Secretaries may take into
consideration the 2016 publication of the
Department of Health and Human Services and the
Department of Labor, entitled ``Warning Signs -
Plan or Policy Non-Quantitative Treatment
Limitations (NQTLs) that Require Additional
Analysis to Determine Mental Health Parity
Compliance''.
(B) Examples illustrating compliance and
noncompliance.--
(i) In general.--The compliance
program guidance document required
under this paragraph shall provide
illustrative, de-identified examples
(that do not disclose any protected
health information or individually
identifiable information) of previous
findings of compliance and
noncompliance with this section,
section 712 of the Employee Retirement
Income Security Act of 1974, or section
9812 of the Internal Revenue Code of
1986, as applicable, based on
investigations of violations of such
sections, including--
(I) examples illustrating
requirements for information
disclosures and nonquantitative
treatment limitations; and
(II) descriptions of the
violations uncovered during the
course of such investigations.
(ii) Nonquantitative treatment
limitations.--To the extent that any
example described in clause (i)
involves a finding of compliance or
noncompliance with regard to any
requirement for nonquantitative
treatment limitations, the example
shall provide sufficient detail to
fully explain such finding, including a
full description of the criteria
involved for approving medical and
surgical benefits and the criteria
involved for approving mental health
and substance use disorder benefits.
(iii) Access to additional
information regarding compliance.--In
developing and issuing the compliance
program guidance document required
under this paragraph, the Secretaries
specified in subparagraph (A)--
(I) shall enter into
interagency agreements with the
Inspector General of the
Department of Health and Human
Services, the Inspector General
of the Department of Labor, and
the Inspector General of the
Department of the Treasury to
share findings of compliance
and noncompliance with this
section, section 712 of the
Employee Retirement Income
Security Act of 1974, or
section 9812 of the Internal
Revenue Code of 1986, as
applicable; and
(II) shall seek to enter into
an agreement with a State to
share information on findings
of compliance and noncompliance
with this section, section 712
of the Employee Retirement
Income Security Act of 1974, or
section 9812 of the Internal
Revenue Code of 1986, as
applicable.
(C) Recommendations.--The compliance program
guidance document shall include recommendations
to advance compliance with this section,
section 712 of the Employee Retirement Income
Security Act of 1974, or section 9812 of the
Internal Revenue Code of 1986, as applicable,
and encourage the development and use of
internal controls to monitor adherence to
applicable statutes, regulations, and program
requirements. Such internal controls may
include illustrative examples of
nonquantitative treatment limitations on mental
health and substance use disorder benefits,
which may fail to comply with this section,
section 712 of the Employee Retirement Income
Security Act of 1974, or section 9812 of the
Internal Revenue Code of 1986, as applicable,
in relation to nonquantitative treatment
limitations on medical and surgical benefits.
(D) Updating the compliance program guidance
document.--The Secretary, the Secretary of
Labor, and the Secretary of the Treasury, in
consultation with the Inspector General of the
Department of Health and Human Services, the
Inspector General of the Department of Labor,
and the Inspector General of the Department of
the Treasury, shall update the compliance
program guidance document every 2 years to
include illustrative, de-identified examples
(that do not disclose any protected health
information or individually identifiable
information) of previous findings of compliance
and noncompliance with this section, section
712 of the Employee Retirement Income Security
Act of 1974, or section 9812 of the Internal
Revenue Code of 1986, as applicable.
(7) Additional guidance.--
(A) In general.--Not later than 12 months
after the date of enactment of the Helping
Families in Mental Health Crisis Reform Act of
2016, the Secretary, the Secretary of Labor,
and the Secretary of the Treasury shall issue
guidance to group health plans and health
insurance issuers offering group or individual
health insurance coverage to assist such plans
and issuers in satisfying the requirements of
this section, section 712 of the Employee
Retirement Income Security Act of 1974, or
section 9812 of the Internal Revenue Code of
1986, as applicable.
(B) Disclosure.--
(i) Guidance for plans and issuers.--
The guidance issued under this
paragraph shall include clarifying
information and illustrative examples
of methods that group health plans and
health insurance issuers offering group
or individual health insurance coverage
may use for disclosing information to
ensure compliance with the requirements
under this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 9812 of the
Internal Revenue Code of 1986, as
applicable, (and any regulations
promulgated pursuant to such sections,
as applicable).
(ii) Documents for participants,
beneficiaries, contracting providers,
or authorized representatives.--The
guidance issued under this paragraph
shall include clarifying information
and illustrative examples of methods
that group health plans and health
insurance issuers offering group or
individual health insurance coverage
may use to provide any participant,
beneficiary, contracting provider, or
authorized representative, as
applicable, with documents containing
information that the health plans or
issuers are required to disclose to
participants, beneficiaries,
contracting providers, or authorized
representatives to ensure compliance
with this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 9812 of the
Internal Revenue Code of 1986, as
applicable, compliance with any
regulation issued pursuant to such
respective section, or compliance with
any other applicable law or regulation.
Such guidance shall include information
that is comparative in nature with
respect to--
(I) nonquantitative treatment
limitations for both medical
and surgical benefits and
mental health and substance use
disorder benefits;
(II) the processes,
strategies, evidentiary
standards, and other factors
used to apply the limitations
described in subclause (I); and
(III) the application of the
limitations described in
subclause (I) to ensure that
such limitations are applied in
parity with respect to both
medical and surgical benefits
and mental health and substance
use disorder benefits.
(C) Nonquantitative treatment limitations.--
The guidance issued under this paragraph shall
include clarifying information and illustrative
examples of methods, processes, strategies,
evidentiary standards, and other factors that
group health plans and health insurance issuers
offering group or individual health insurance
coverage may use regarding the development and
application of nonquantitative treatment
limitations to ensure compliance with this
section, section 712 of the Employee Retirement
Income Security Act of 1974, or section 9812 of
the Internal Revenue Code of 1986, as
applicable, (and any regulations promulgated
pursuant to such respective section),
including--
(i) examples of methods of
determining appropriate types of
nonquantitative treatment limitations
with respect to both medical and
surgical benefits and mental health and
substance use disorder benefits,
including nonquantitative treatment
limitations pertaining to--
(I) medical management
standards based on medical
necessity or appropriateness,
or whether a treatment is
experimental or investigative;
(II) limitations with respect
to prescription drug formulary
design; and
(III) use of fail-first or
step therapy protocols;
(ii) examples of methods of
determining--
(I) network admission
standards (such as
credentialing); and
(II) factors used in provider
reimbursement methodologies
(such as service type,
geographic market, demand for
services, and provider supply,
practice size, training,
experience, and licensure) as
such factors apply to network
adequacy;
(iii) examples of sources of
information that may serve as
evidentiary standards for the purposes
of making determinations regarding the
development and application of
nonquantitative treatment limitations;
(iv) examples of specific factors,
and the evidentiary standards used to
evaluate such factors, used by such
plans or issuers in performing a
nonquantitative treatment limitation
analysis;
(v) examples of how specific
evidentiary standards may be used to
determine whether treatments are
considered experimental or
investigative;
(vi) examples of how specific
evidentiary standards may be applied to
each service category or classification
of benefits;
(vii) examples of methods of reaching
appropriate coverage determinations for
new mental health or substance use
disorder treatments, such as evidence-
based early intervention programs for
individuals with a serious mental
illness and types of medical management
techniques;
(viii) examples of methods of
reaching appropriate coverage
determinations for which there is an
indirect relationship between the
covered mental health or substance use
disorder benefit and a traditional
covered medical and surgical benefit,
such as residential treatment or
hospitalizations involving voluntary or
involuntary commitment; and
(ix) additional illustrative examples
of methods, processes, strategies,
evidentiary standards, and other
factors for which the Secretary
determines that additional guidance is
necessary to improve compliance with
this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 9812 of the
Internal Revenue Code of 1986, as
applicable.
(D) Public comment.--Prior to issuing any
final guidance under this paragraph, the
Secretary shall provide a public comment period
of not less than 60 days during which any
member of the public may provide comments on a
draft of the guidance.
(8) Compliance requirements.--
(A) Nonquantitative treatment limitation
(nqtl) requirements.--In the case of a group
health plan or a health insurance issuer
offering group or individual health insurance
coverage that provides both medical and
surgical benefits and mental health or
substance use disorder benefits and that
imposes nonquantitative treatment limitations
(referred to in this section as ``NQTL'') on
mental health or substance use disorder
benefits, the plan or issuer offering health
insurance coverage shall perform comparative
analyses of the design and application of NQTLs
in accordance with subparagraph (B), and,
beginning 45 days after the date of enactment
of this paragraph, make available to the
applicable State authority (or, as applicable,
the Secretary), upon request, the comparative
analyses and the following information:
(i) The specific plan or coverage
terms regarding the NQTL, that applies
to such plan or coverage, and a
description of all mental health or
substance use disorder and medical or
surgical benefits to which it applies
in each respective benefits
classification.
(ii) The factors used to determine
that the NQTL will apply to mental
health or substance use disorder
benefits and medical or surgical
benefits.
(iii) The evidentiary standards used
for the factors identified in clause
(ii), when applicable, provided that
every factor shall be defined and any
other source or evidence relied upon to
design and apply the NQTL to mental
health or substance use disorder
benefits and medical or surgical
benefits.
(iv) The comparative analyses
demonstrating that the processes,
strategies, evidentiary standards, and
other factors used to design the NQTL,
as written, and the operation processes
and strategies as written and in
operation that are used to apply the
NQTL for mental health or substance use
disorder benefits are comparable to,
and are applied no more stringently
than, the processes, strategies,
evidentiary standards, and other
factors used to design the NQTL, as
written, and the operation processes
and strategies as written and in
operation that are used to apply the
NQTL to medical or surgical benefits.
(v) A disclosure of the specific
findings and conclusions reached by the
plan or coverage that the results of
the analyses described in this
subparagraph indicate that the plan or
coverage is in compliance with this
section.
(B) Secretary request process.--
(i) Submission upon request.--The
Secretary shall request that a group
health plan or a health insurance
issuer offering group or individual
health insurance coverage submit the
comparative analyses described in
subparagraph (A) for plans that involve
potential violations of this section or
complaints regarding noncompliance with
this section that concern NQTLs and any
other instances in which the Secretary
determines appropriate. The Secretary
shall request not fewer than 20 such
analyses per year.
(ii) Additional information.--In
instances in which the Secretary has
concluded that the plan or coverage has
not submitted sufficient information
for the Secretary to review the
comparative analyses described in
subparagraph (A), as requested under
clause (i), the Secretary shall specify
to the plan or coverage the information
the plan or coverage must submit to be
responsive to the request under clause
(i) for the Secretary to review the
comparative analyses described in
subparagraph(A) for compliance with
this section. Nothing in this paragraph
shall require the Secretary to conclude
that a plan is in compliance with this
section solely based upon the
inspection of the comparative analyses
described in subparagraph (A), as
requested under clause (i).
(iii) Required action.--
(I) In general.--In instances
in which the Secretary has
reviewed the comparative
analyses described in
subparagraph (A), as requested
under clause (i), and
determined that the plan or
coverage is not in compliance
with this section, the plan or
coverage--
(aa) shall specify to
the Secretary the
actions the plan or
coverage will take to
be in compliance with
this section and
provide to the
Secretary comparative
analyses described in
subparagraph (A) that
demonstrate compliance
with this section not
later than 45 days
after the initial
determination by the
Secretary that the plan
or coverage is not in
compliance; and
(bb) following the
45-day corrective
action period under
item (aa), if the
Secretary determines
that the plan or
coverage still is not
in compliance with this
section, not later than
7 days after such
determination, shall
notify all individuals
enrolled in the plan or
coverage that the plan
or coverage has been
determined to be not in
compliance with this
section.
(II) Exemption from
disclosure.--Documents or
communications produced in
connection with the Secretary's
recommendations to the plan or
coverage shall not be subject
to disclosure pursuant to
section 552 of title 5, United
States Code.
(iv) Report.--Not later than 1 year
after the date of enactment of this
paragraph, and not later than October 1
of each year thereafter, the Secretary
shall submit to Congress, and make
publicly available, a report that
contains--
(I) a summary of the
comparative analyses requested
under clause (i), including the
identity of each plan or
coverage that is determined to
be not in compliance after the
final determination by the
Secretary described in clause
(iii)(I)(bb);
(II) the Secretary's
conclusions as to whether each
plan or coverage submitted
sufficient information for the
Secretary to review the
comparative analyses requested
under clause (i) for compliance
with this section;
(III) for each plan or
coverage that did submit
sufficient information for the
Secretary to review the
comparative analyses requested
under clause (i), the
Secretary's conclusions as to
whether and why the plan or
coverage is in compliance with
the requirements under this
section;
(IV) the Secretary's
specifications described in
clause (ii) for each plan or
coverage that the Secretary
determined did not submit
sufficient information for the
Secretary to review the
comparative analyses requested
under clause (i) for compliance
with this section; and
(V) the Secretary's
specifications described in
clause (iii) of the actions
each plan or coverage that the
Secretary determined is not in
compliance with this section
must take to be in compliance
with this section, including
the reason why the Secretary
determined the plan or coverage
is not in compliance.
(C) Compliance program guidance document
update process.--
(i) In general.--The Secretary shall
include instances of noncompliance that
the Secretary discovers upon reviewing
the comparative analyses requested
under subparagraph (B)(i) in the
compliance program guidance document
described in paragraph (6), as it is
updated every 2 years, except that such
instances shall not disclose any
protected health information or
individually identifiable information.
(ii) Guidance and regulations.--Not
later than 18 months after the date of
enactment of this paragraph, the
Secretary shall finalize any draft or
interim guidance and regulations
relating to mental health parity under
this section. Such draft guidance shall
include guidance to clarify the process
and timeline for current and potential
participants and beneficiaries (and
authorized representatives and health
care providers of such participants and
beneficiaries) with respect to plans to
file complaints of such plans or
issuers being in violation of this
section, including guidance, by plan
type, on the relevant State, regional,
or national office with which such
complaints should be filed.
(iii) State.--The Secretary shall
share information on findings of
compliance and noncompliance discovered
upon reviewing the comparative analyses
requested under subparagraph (B)(i)
with the State where the group health
plan is located or the State where the
health insurance issuer is licensed to
do business for coverage offered by a
health insurance issuer in the group
market, in accordance with paragraph
(6)(B)(iii)(II).
(b) Construction.--Nothing in this section shall be
construed--
(1) as requiring a group health plan or a health
insurance issuer offering group or individual health
insurance coverage to provide any mental health or
substance use disorder benefits; or
(2) in the case of a group health plan or a health
insurance issuer offering group or individual health
insurance coverage that provides mental health or
substance use disorder benefits, as affecting the terms
and conditions of the plan or coverage relating to such
benefits under the plan or coverage, except as provided
in subsection (a).
(c) Exemptions.--
(1) Small employer exemption.--This section shall not
apply to any group health plan and a health insurance
issuer offering group or individual health insurance
coverage for any plan year of a small employer (as
defined in section 2791(e)(4), except that for purposes
of this paragraph such term shall include employers
with 1 employee in the case of an employer residing in
a State that permits small groups to include a single
individual).
(2) Cost exemption.--
(A) In general.--With respect to a group
health plan or a health insurance issuer
offering group or individual health insurance
coverage, if the application of this section to
such plan (or coverage) results in an increase
for the plan year involved of the actual total
costs of coverage with respect to medical and
surgical benefits and mental health and
substance use disorder benefits under the plan
(as determined and certified under subparagraph
(C)) by an amount that exceeds the applicable
percentage described in subparagraph (B) of the
actual total plan costs, the provisions of this
section shall not apply to such plan (or
coverage) during the following plan year, and
such exemption shall apply to the plan (or
coverage) for 1 plan year. An employer may
elect to continue to apply mental health and
substance use disorder parity pursuant to this
section with respect to the group health plan
(or coverage) involved regardless of any
increase in total costs.
(B) Applicable percentage.--With respect to a
plan (or coverage), the applicable percentage
described in this subparagraph shall be--
(i) 2 percent in the case of the
first plan year in which this section
is applied; and
(ii) 1 percent in the case of each
subsequent plan year.
(C) Determinations by actuaries.--
Determinations as to increases in actual costs
under a plan (or coverage) for purposes of this
section shall be made and certified by a
qualified and licensed actuary who is a member
in good standing of the American Academy of
Actuaries. All such determinations shall be in
a written report prepared by the actuary. The
report, and all underlying documentation relied
upon by the actuary, shall be maintained by the
group health plan or health insurance issuer
for a period of 6 years following the
notification made under subparagraph (E).
(D) 6-month determinations.--If a group
health plan (or a health insurance issuer
offering coverage in connection with a group
health plan) seeks an exemption under this
paragraph, determinations under subparagraph
(A) shall be made after such plan (or coverage)
has complied with this section for the first 6
months of the plan year involved.
(E) Notification.--
(i) In general.--A group health plan
(or a health insurance issuer offering
coverage in connection with a group
health plan) that, based upon a
certification described under
subparagraph (C), qualifies for an
exemption under this paragraph, and
elects to implement the exemption,
shall promptly notify the Secretary,
the appropriate State agencies, and
participants and beneficiaries in the
plan of such election.
(ii) Requirement.--A notification to
the Secretary under clause (i) shall
include--
(I) a description of the
number of covered lives under
the plan (or coverage) involved
at the time of the
notification, and as
applicable, at the time of any
prior election of the cost-
exemption under this paragraph
by such plan (or coverage);
(II) for both the plan year
upon which a cost exemption is
sought and the year prior, a
description of the actual total
costs of coverage with respect
to medical and surgical
benefits and mental health and
substance use disorder benefits
under the plan; and
(III) for both the plan year
upon which a cost exemption is
sought and the year prior, the
actual total costs of coverage
with respect to mental health
and substance use disorder
benefits under the plan.
(iii) Confidentiality.--A
notification to the Secretary under
clause (i) shall be confidential. The
Secretary shall make available, upon
request and on not more than an annual
basis, an anonymous itemization of such
notifications, that includes--
(I) a breakdown of States by
the size and type of employers
submitting such notification;
and
(II) a summary of the data
received under clause (ii).
(F) Audits by appropriate agencies.--To
determine compliance with this paragraph, the
Secretary may audit the books and records of a
group health plan or health insurance issuer
relating to an exemption, including any
actuarial reports prepared pursuant to
subparagraph (C), during the 6 year period
following the notification of such exemption
under subparagraph (E). A State agency
receiving a notification under subparagraph (E)
may also conduct such an audit with respect to
an exemption covered by such notification.
(d) Separate Application to Each Option Offered.--In the case
of a group health plan that offers a participant or beneficiary
two or more benefit package options under the plan, the
requirements of this section shall be applied separately with
respect to each such option.
(e) Definitions.--For purposes of this section--
(1) Aggregate lifetime limit.--The term ``aggregate
lifetime limit'' means, with respect to benefits under
a group health plan or health insurance coverage, a
dollar limitation on the total amount that may be paid
with respect to such benefits under the plan or health
insurance coverage with respect to an individual or
other coverage unit.
(2) Annual limit.--The term ``annual limit'' means,
with respect to benefits under a group health plan or
health insurance coverage, a dollar limitation on the
total amount of benefits that may be paid with respect
to such benefits in a 12-month period under the plan or
health insurance coverage with respect to an individual
or other coverage unit.
(3) Medical or surgical benefits.--The term ``medical
or surgical benefits'' means benefits with respect to
medical or surgical services, as defined under the
terms of the plan or coverage (as the case may be), but
does not include mental health or substance use
disorder benefits.
(4) Mental health benefits.--The term ``mental health
benefits'' means benefits with respect to services for
mental health conditions, as defined under the terms of
the plan and in accordance with applicable Federal and
State law.
(5) Substance use disorder benefits.--The term
``substance use disorder benefits'' means benefits with
respect to services for substance use disorders, as
defined under the terms of the plan and in accordance
with applicable Federal and State law.
----------
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974
* * * * * * *
TITLE I--PROTECTION OF EMPLOYEE BENEFIT RIGHTS
* * * * * * *
Subtitle B--Regulatory Provisions
* * * * * * *
Part 7--Group Health Plan Requirements
* * * * * * *
Subpart B--Other Requirements
* * * * * * *
SEC. 712. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DISORDER BENEFITS.
(a) In General.--
(1) Aggregate lifetime limits.--In the case of a
group health plan (or health insurance coverage offered
in connection with such a plan) that provides both
medical and surgical benefits and mental health or
substance use disorder benefits--
(A) No lifetime limit.--If the plan or
coverage does not include an aggregate lifetime
limit on substantially all medical and surgical
benefits, the plan or coverage may not impose
any aggregate lifetime limit on mental health
or substance use disorder benefits.
(B) Lifetime limit.--If the plan or coverage
includes an aggregate lifetime limit on
substantially all medical and surgical benefits
(in this paragraph referred to as the
``applicable lifetime limit''), the plan or
coverage shall either--
(i) apply the applicable lifetime
limit both to the medical and surgical
benefits to which it otherwise would
apply and to mental health and
substance use disorder benefits and not
distinguish in the application of such
limit between such medical and surgical
benefits and mental health and
substance use disorder benefits; or
(ii) not include any aggregate
lifetime limit on mental health or
substance use disorder benefits that is
less than the applicable lifetime
limit.
(C) Rule in case of different limits.--In the
case of a plan or coverage that is not
described in subparagraph (A) or (B) and that
includes no or different aggregate lifetime
limits on different categories of medical and
surgical benefits, the Secretary shall
establish rules under which subparagraph (B) is
applied to such plan or coverage with respect
to mental health and substance use disorder
benefits by substituting for the applicable
lifetime limit an average aggregate lifetime
limit that is computed taking into account the
weighted average of the aggregate lifetime
limits applicable to such categories.
(2) Annual limits.--In the case of a group health
plan (or health insurance coverage offered in
connection with such a plan) that provides both medical
and surgical benefits and mental health or substance
use disorder benefits--
(A) No annual limit.--If the plan or coverage
does not include an annual limit on
substantially all medical and surgical
benefits, the plan or coverage may not impose
any annual limit on mental health or substance
use disorder benefits.
(B) Annual limit.--If the plan or coverage
includes an annual limit on substantially all
medical and surgical benefits (in this
paragraph referred to as the ``applicable
annual limit''), the plan or coverage shall
either--
(i) apply the applicable annual limit
both to medical and surgical benefits
to which it otherwise would apply and
to mental health and substance use
disorder benefits and not distinguish
in the application of such limit
between such medical and surgical
benefits and mental health and
substance use disorder benefits; or
(ii) not include any annual limit on
mental health or substance use disorder
benefits that is less than the
applicable annual limit.
(C) Rule in case of different limits.--In the
case of a plan or coverage that is not
described in subparagraph (A) or (B) and that
includes no or different annual limits on
different categories of medical and surgical
benefits, the Secretary shall establish rules
under which subparagraph (B) is applied to such
plan or coverage with respect to mental health
and substance use disorder benefits by
substituting for the applicable annual limit an
average annual limit that is computed taking
into account the weighted average of the annual
limits applicable to such categories.
(3) Financial requirements and treatment
limitations.--
(A) In general.--In the case of a group
health plan (or health insurance coverage
offered in connection with such a plan) that
provides both medical and surgical benefits and
mental health or substance use disorder
benefits, such plan or coverage shall ensure
that--
(i) the financial requirements
applicable to such mental health or
substance use disorder benefits are no
more restrictive than the predominant
financial requirements applied to
substantially all medical and surgical
benefits covered by the plan (or
coverage), and there are no separate
cost sharing requirements that are
applicable only with respect to mental
health or substance use disorder
benefits; and
(ii) the treatment limitations
applicable to such mental health or
substance use disorder benefits are no
more restrictive than the predominant
treatment limitations applied to
substantially all medical and surgical
benefits covered by the plan (or
coverage) and there are no separate
treatment limitations that are
applicable only with respect to mental
health or substance use disorder
benefits.
(B) Definitions.--In this paragraph:
(i) Financial requirement.--The term
``financial requirement'' includes
deductibles, copayments, coinsurance,
and out-of-pocket expenses, but
excludes an aggregate lifetime limit
and an annual limit subject to
paragraphs (1) and (2),
(ii) Predominant.--A financial
requirement or treatment limit is
considered to be predominant if it is
the most common or frequent of such
type of limit or requirement.
(iii) Treatment limitation.--The term
``treatment limitation'' includes
limits on the frequency of treatment,
number of visits, days of coverage, or
other similar limits on the scope or
duration of treatment.
(4) Availability of plan information.--The criteria
for medical necessity determinations made under the
plan with respect to mental health or substance use
disorder benefits (or the health insurance coverage
offered in connection with the plan with respect to
such benefits) shall be made available by the plan
administrator (or the health insurance issuer offering
such coverage) in accordance with regulations to any
current or potential participant, beneficiary, or
contracting provider upon request. The reason for any
denial under the plan (or coverage) of reimbursement or
payment for services with respect to mental health or
substance use disorder benefits in the case of any
participant or beneficiary shall, on request or as
otherwise required, be made available by the plan
administrator (or the health insurance issuer offering
such coverage) to the participant or beneficiary in
accordance with regulations.
(5) Out-of-network providers.--In the case of a plan
or coverage that provides both medical and surgical
benefits and mental health or substance use disorder
benefits, if the plan or coverage provides coverage for
medical or surgical benefits provided by out-of-network
providers, the plan or coverage shall provide coverage
for mental health or substance use disorder benefits
provided by out-of-network providers in a manner that
is consistent with the requirements of this section.
(6) Compliance program guidance document.--
(A) In general.--Not later than 12 months
after the date of enactment of the Helping
Families in Mental Health Crisis Reform Act of
2016, the Secretary, the Secretary of Health
and Human Services, and the Secretary of the
Treasury, in consultation with the Inspector
General of the Department of Health and Human
Services, the Inspector General of the
Department of Labor, and the Inspector General
of the Department of the Treasury, shall issue
a compliance program guidance document to help
improve compliance with this section, section
2799A-1 of the Public Health Service Act, and
section 9812 of the Internal Revenue Code of
1986, as applicable. In carrying out this
paragraph, the Secretaries may take into
consideration the 2016 publication of the
Department of Health and Human Services and the
Department of Labor, entitled ``Warning Signs -
Plan or Policy Non-Quantitative Treatment
Limitations (NQTLs) that Require Additional
Analysis to Determine Mental Health Parity
Compliance''.
(B) Examples illustrating compliance and
noncompliance.--
(i) In general.--The compliance
program guidance document required
under this paragraph shall provide
illustrative, de-identified examples
(that do not disclose any protected
health information or individually
identifiable information) of previous
findings of compliance and
noncompliance with this section,
section 2799A-1 of the Public Health
Service Act, or section 9812 of the
Internal Revenue Code of 1986, as
applicable, based on investigations of
violations of such sections,
including--
(I) examples illustrating
requirements for information
disclosures and nonquantitative
treatment limitations; and
(II) descriptions of the
violations uncovered during the
course of such investigations.
(ii) Nonquantitative treatment
limitations.--To the extent that any
example described in clause (i)
involves a finding of compliance or
noncompliance with regard to any
requirement for nonquantitative
treatment limitations, the example
shall provide sufficient detail to
fully explain such finding, including a
full description of the criteria
involved for approving medical and
surgical benefits and the criteria
involved for approving mental health
and substance use disorder benefits.
(iii) Access to additional
information regarding compliance.--In
developing and issuing the compliance
program guidance document required
under this paragraph, the Secretaries
specified in subparagraph (A)--
(I) shall enter into
interagency agreements with the
Inspector General of the
Department of Health and Human
Services, the Inspector General
of the Department of Labor, and
the Inspector General of the
Department of the Treasury to
share findings of compliance
and noncompliance with this
section, section 2799A-1 of the
Public Health Service Act, or
section 9812 of the Internal
Revenue Code of 1986, as
applicable; and
(II) shall seek to enter into
an agreement with a State to
share information on findings
of compliance and noncompliance
with this section, section
2799A-1 of the Public Health
Service Act, or section 9812 of
the Internal Revenue Code of
1986, as applicable.
(C) Recommendations.--The compliance program
guidance document shall include recommendations
to advance compliance with this section,
section 2799A-1 of the Public Health Service
Act, or section 9812 of the Internal Revenue
Code of 1986, as applicable, and encourage the
development and use of internal controls to
monitor adherence to applicable statutes,
regulations, and program requirements. Such
internal controls may include illustrative
examples of nonquantitative treatment
limitations on mental health and substance use
disorder benefits, which may fail to comply
with this section, section 2799A-1 of the
Public Health Service Act, or section 9812 of
the Internal Revenue Code of 1986, as
applicable, in relation to nonquantitative
treatment limitations on medical and surgical
benefits.
(D) Updating the compliance program guidance
document.--The Secretary, the Secretary of
Health and Human Services, and the Secretary of
the Treasury, in consultation with the
Inspector General of the Department of Health
and Human Services, the Inspector General of
the Department of Labor, and the Inspector
General of the Department of the Treasury,
shall update the compliance program guidance
document every 2 years to include illustrative,
de-identified examples (that do not disclose
any protected health information or
individually identifiable information) of
previous findings of compliance and
noncompliance with this section, section 2799A-
1 of the Public Health Service Act, or section
9812 of the Internal Revenue Code of 1986, as
applicable.
(7) Additional guidance.--
(A) In general.--Not later than 12 months
after the date of enactment of the Helping
Families in Mental Health Crisis Reform Act of
2016, the Secretary, the Secretary of Health
and Human Services, and the Secretary of the
Treasury shall issue guidance to group health
plans and health insurance issuers offering
group or individual health insurance coverage
to assist such plans and issuers in satisfying
the requirements of this section, section
2799A-1 of the Public Health Service Act, or
section 9812 of the Internal Revenue Code of
1986, as applicable.
(B) Disclosure.--
(i) Guidance for plans and issuers.--
The guidance issued under this
paragraph shall include clarifying
information and illustrative examples
of methods that group health plans and
health insurance issuers offering group
or individual health insurance coverage
may use for disclosing information to
ensure compliance with the requirements
under this section, section 2799A-1 of
the Public Health Service Act, or
section 9812 of the Internal Revenue
Code of 1986, as applicable, (and any
regulations promulgated pursuant to
such sections, as applicable).
(ii) Documents for participants,
beneficiaries, contracting providers,
or authorized representatives.--The
guidance issued under this paragraph
shall include clarifying information
and illustrative examples of methods
that group health plans and health
insurance issuers offering group or
individual health insurance coverage
may use to provide any participant,
beneficiary, contracting provider, or
authorized representative, as
applicable, with documents containing
information that the health plans or
issuers are required to disclose to
participants, beneficiaries,
contracting providers, or authorized
representatives to ensure compliance
with this section, section 2799A-1 of
the Public Health Service Act, or
section 9812 of the Internal Revenue
Code of 1986, as applicable, compliance
with any regulation issued pursuant to
such respective section, or compliance
with any other applicable law or
regulation. Such guidance shall include
information that is comparative in
nature with respect to--
(I) nonquantitative treatment
limitations for both medical
and surgical benefits and
mental health and substance use
disorder benefits;
(II) the processes,
strategies, evidentiary
standards, and other factors
used to apply the limitations
described in subclause (I); and
(III) the application of the
limitations described in
subclause (I) to ensure that
such limitations are applied in
parity with respect to both
medical and surgical benefits
and mental health and substance
use disorder benefits.
(C) Nonquantitative treatment limitations.--
The guidance issued under this paragraph shall
include clarifying information and illustrative
examples of methods, processes, strategies,
evidentiary standards, and other factors that
group health plans and health insurance issuers
offering group or individual health insurance
coverage may use regarding the development and
application of nonquantitative treatment
limitations to ensure compliance with this
section, section 2799A-1 of the Public Health
Service Act, or section 9812 of the Internal
Revenue Code of 1986, as applicable, (and any
regulations promulgated pursuant to such
respective section), including--
(i) examples of methods of
determining appropriate types of
nonquantitative treatment limitations
with respect to both medical and
surgical benefits and mental health and
substance use disorder benefits,
including nonquantitative treatment
limitations pertaining to--
(I) medical management
standards based on medical
necessity or appropriateness,
or whether a treatment is
experimental or investigative;
(II) limitations with respect
to prescription drug formulary
design; and
(III) use of fail-first or
step therapy protocols;
(ii) examples of methods of
determining--
(I) network admission
standards (such as
credentialing); and
(II) factors used in provider
reimbursement methodologies
(such as service type,
geographic market, demand for
services, and provider supply,
practice size, training,
experience, and licensure) as
such factors apply to network
adequacy;
(iii) examples of sources of
information that may serve as
evidentiary standards for the purposes
of making determinations regarding the
development and application of
nonquantitative treatment limitations;
(iv) examples of specific factors,
and the evidentiary standards used to
evaluate such factors, used by such
plans or issuers in performing a
nonquantitative treatment limitation
analysis;
(v) examples of how specific
evidentiary standards may be used to
determine whether treatments are
considered experimental or
investigative;
(vi) examples of how specific
evidentiary standards may be applied to
each service category or classification
of benefits;
(vii) examples of methods of reaching
appropriate coverage determinations for
new mental health or substance use
disorder treatments, such as evidence-
based early intervention programs for
individuals with a serious mental
illness and types of medical management
techniques;
(viii) examples of methods of
reaching appropriate coverage
determinations for which there is an
indirect relationship between the
covered mental health or substance use
disorder benefit and a traditional
covered medical and surgical benefit,
such as residential treatment or
hospitalizations involving voluntary or
involuntary commitment; and
(ix) additional illustrative examples
of methods, processes, strategies,
evidentiary standards, and other
factors for which the Secretary
determines that additional guidance is
necessary to improve compliance with
this section, section 2799A-1 of the
Public Health Service Act, or section
9812 of the Internal Revenue Code of
1986, as applicable.
(D) Public comment.--Prior to issuing any
final guidance under this paragraph, the
Secretary shall provide a public comment period
of not less than 60 days during which any
member of the public may provide comments on a
draft of the guidance.
(8) Compliance requirements.--
(A) Nonquantitative treatment limitation
(nqtl) requirements.--Beginning 45 days after
the date of enactment of this paragraph, in the
case of a group health plan or a health
insurance issuer offering group health
insurance coverage that provides both medical
and surgical benefits and mental health or
substance use disorder benefits and that
imposes nonquantitative treatment limitations
(referred to in this section as ``NQTL'') on
mental health or substance use disorder
benefits, the plan or issuer offering health
insurance coverage shall perform comparative
analyses of the design and application of NQTLs
in accordance with subparagraph (B), and make
available to the applicable State authority
(or, as applicable, the Secretary), upon
request, the following information:
(i) The specific plan or coverage
terms regarding the NQTL, that applies
to such plan or coverage, and a
description of all mental health or
substance use disorder and medical or
surgical benefits to which it applies
in each respective benefits
classification.
(ii) The factors used to determine
that the NQTL will apply to mental
health or substance use disorder
benefits and medical or surgical
benefits.
(iii) The evidentiary standards used
for the factors identified in clause
(ii), when applicable, provided that
every factor shall be defined and any
other source or evidence relied upon to
design and apply the NQTL to mental
health or substance use disorder
benefits and medical or surgical
benefits.
(iv) The comparative analyses
demonstrating that the processes,
strategies, evidentiary standards, and
other factors used to design the NQTL,
as written, and the operation processes
and strategies as written and in
operation that are used to apply the
NQTL for mental health or substance use
disorder benefits are comparable to,
and are applied no more stringently
than, the processes, strategies,
evidentiary standards, and other
factors used to design the NQTL, as
written, and the operation processes
and strategies as written and in
operation that are used to apply the
NQTL to medical or surgical benefits.
(v) A disclosure of the specific
findings and conclusions reached by the
plan or coverage that the results of
the analyses described in this
subparagraph indicate that the plan or
coverage is in compliance with this
section.
(B) Secretary request process.--
(i) Submission upon request.--The
Secretary shall request that a group
health plan or a health insurance
issuer offering group health insurance
coverage submit the comparative
analyses described in subparagraph (A)
for plans that involve potential
violations of this section or
complaints regarding noncompliance with
this section that concern NQTLs and any
other instances in which the Secretary
determines appropriate. The Secretary
shall request not fewer than 20 such
analyses per year.
(ii) Additional information.--In
instances in which the Secretary has
concluded that the plan or coverage has
not submitted sufficient information
for the Secretary to review the
comparative analyses described in
subparagraph (A), as requested under
clause (i), the Secretary shall specify
to the plan or coverage the information
the plan or coverage must submit to be
responsive to the request under clause
(i) for the Secretary to review the
comparative analyses described in
subparagraph(A) for compliance with
this section. Nothing in this paragraph
shall require the Secretary to conclude
that a plan is in compliance with this
section solely based upon the
inspection of the comparative analyses
described in subparagraph (A), as
requested under clause (i).
(iii) Required action.--
(I) In general.--In instances
in which the Secretary has
reviewed the comparative
analyses described in
subparagraph (A), as requested
under clause (i), and
determined that the plan or
coverage is not in compliance
with this section, the plan or
coverage--
(aa) shall specify to
the Secretary the
actions the plan or
coverage will take to
be in compliance with
this section and
provide to the
Secretary comparative
analyses described in
subparagraph (A) that
demonstrate compliance
with this section not
later than 45 days
after the initial
determination by the
Secretary that the plan
or coverage is not in
compliance; and
(bb) following the
45-day corrective
action period under
item (aa), if the
Secretary determines
that the plan or
coverage still is not
in compliance with this
section, not later than
7 days after such
determination, shall
notify all individuals
enrolled in the plan or
coverage that the plan
or coverage has been
determined to be not in
compliance with this
section.
(II) Exemption from
disclosure.--Documents or
communications produced in
connection with the Secretary's
recommendations to the plan or
coverage shall not be subject
to disclosure pursuant to
section 552 of title 5, United
States Code.
(iv) Report.--Not later than 1 year
after the date of enactment of this
paragraph, and not later than October 1
of each year thereafter, the Secretary
shall submit to Congress, and make
publicly available, a report that
contains--
(I) a summary of the
comparative analyses requested
under clause (i), including the
identity of each plan or
coverage that is determined to
be not in compliance after the
final determination by the
Secretary described in clause
(iii)(I)(bb);
(II) the Secretary's
conclusions as to whether each
plan or coverage submitted
sufficient information for the
Secretary to review the
comparative analyses requested
under clause (i) for compliance
with this section;
(III) for each plan or
coverage that did submit
sufficient information for the
Secretary to review the
comparative analyses requested
under clause (i), the
Secretary's conclusions as to
whether and why the plan or
coverage is in compliance with
the requirements under this
section;
(IV) the Secretary's
specifications described in
clause (ii) for each plan or
coverage that the Secretary
determined did not submit
sufficient information for the
Secretary to review the
comparative analyses requested
under clause (i) for compliance
with this section; and
(V) the Secretary's
specifications described in
clause (iii) of the actions
each plan or coverage that the
Secretary determined is not in
compliance with this section
must take to be in compliance
with this section, including
the reason why the Secretary
determined the plan or coverage
is not in compliance.
(C) Compliance program guidance document
update process.--
(i) In general.--The Secretary shall
include instances of noncompliance that
the Secretary discovers upon reviewing
the comparative analyses requested
under subparagraph (B)(i) in the
compliance program guidance document
described in paragraph (6), as it is
updated every 2 years, except that such
instances shall not disclose any
protected health information or
individually identifiable information.
(ii) Guidance and regulations.--Not
later than 18 months after the date of
enactment of this paragraph, the
Secretary shall finalize any draft or
interim guidance and regulations
relating to mental health parity under
this section. Such draft guidance shall
include guidance to clarify the process
and timeline for current and potential
participants and beneficiaries (and
authorized representatives and health
care providers of such participants and
beneficiaries) with respect to plans to
file complaints of such plans or
issuers being in violation of this
section, including guidance, by plan
type, on the relevant State, regional,
or national office with which such
complaints should be filed.
(iii) State.--The Secretary shall
share information on findings of
compliance and noncompliance discovered
upon reviewing the comparative analyses
requested under subparagraph (B)(i)
with the State where the group health
plan is located or the State where the
health insurance issuer is licensed to
do business for coverage offered by a
health insurance issuer in the group
market, in accordance with paragraph
(6)(B)(iii)(II).
(b) Construction.--Nothing in this section shall be
construed--
(1) as requiring a group health plan (or health
insurance coverage offered in connection with such a
plan) to provide any mental health or substance use
disorder benefits; or
(2) in the case of a group health plan (or health
insurance coverage offered in connection with such a
plan) that provides mental health or substance use
disorder benefits, as affecting the terms and
conditions of the plan or coverage relating to such
benefits under the plan or coverage, except as provided
in subsection (a).
(c) Exemptions.--
(1) Small employer exemption.--
(A) In general.--This section shall not apply
to any group health plan (and group health
insurance coverage offered in connection with a
group health plan) for any plan year of a small
employer.
(B) Small employer.--For purposes of
subparagraph (A), the term ``small employer''
means, in connection with a group health plan
with respect to a calendar year and a plan
year, an employer who employed an average of at
least 2 (or 1 in the case of an employer
residing in a State that permits small groups
to include a single individual) but not more
than 50 employees on business days during the
preceding calendar year.
(C) Application of certain rules in
determination of employer size.--For purposes
of this paragraph--
(i) Application of aggregation rule
for employers.--Rules similar to the
rules under subsections (b), (c), (m),
and (o) of section 414 of the Internal
Revenue Code of 1986 shall apply for
purposes of treating persons as a
single employer.
(ii) Employers not in existence in
preceding year.--In the case of an
employer which was not in existence
throughout the preceding calendar year,
the determination of whether such
employer is a small employer shall be
based on the average number of
employees that it is reasonably
expected such employer will employ on
business days in the current calendar
year.
(iii) Predecessors.--Any reference in
this paragraph to an employer shall
include a reference to any predecessor
of such employer.
(2) Cost exemption.--
(A) In general.--With respect to a group
health plan (or health insurance coverage
offered in connection with such a plan), if the
application of this section to such plan (or
coverage) results in an increase for the plan
year involved of the actual total costs of
coverage with respect to medical and surgical
benefits and mental health and substance use
disorder benefits under the plan (as determined
and certified under subparagraph (C)) by an
amount that exceeds the applicable percentage
described in subparagraph (B) of the actual
total plan costs, the provisions of this
section shall not apply to such plan (or
coverage) during the following plan year, and
such exemption shall apply to the plan (or
coverage) for 1 plan year. An employer may
elect to continue to apply mental health and
substance use disorder parity pursuant to this
section with respect to the group health plan
(or coverage) involved regardless of any
increase in total costs.
(B) Applicable percentage.--With respect to a
plan (or coverage), the applicable percentage
described in this subparagraph shall be--
(i) 2 percent in the case of the
first plan year in which this section
is applied; and
(ii) 1 percent in the case of each
subsequent plan year.
(C) Determinations by actuaries.--
Determinations as to increases in actual costs
under a plan (or coverage) for purposes of this
section shall be made and certified by a
qualified and licensed actuary who is a member
in good standing of the American Academy of
Actuaries. All such determinations shall be in
a written report prepared by the actuary. The
report, and all underlying documentation relied
upon by the actuary, shall be maintained by the
group health plan or health insurance issuer
for a period of 6 years following the
notification made under subparagraph (E).
(D) 6-month determinations.--If a group
health plan (or a health insurance issuer
offering coverage in connection with a group
health plan) seeks an exemption under this
paragraph, determinations under subparagraph
(A) shall be made after such plan (or coverage)
has complied with this section for the first 6
months of the plan year involved.
(E) Notification.--
(i) In general.--A group health plan
(or a health insurance issuer offering
coverage in connection with a group
health plan) that, based upon a
certification described under
subparagraph (C), qualifies for an
exemption under this paragraph, and
elects to implement the exemption,
shall promptly notify the Secretary,
the appropriate State agencies, and
participants and beneficiaries in the
plan of such election.
(ii) Requirement.--A notification to
the Secretary under clause (i) shall
include--
(I) a description of the
number of covered lives under
the plan (or coverage) involved
at the time of the
notification, and as
applicable, at the time of any
prior election of the cost-
exemption under this paragraph
by such plan (or coverage);
(II) for both the plan year
upon which a cost exemption is
sought and the year prior, a
description of the actual total
costs of coverage with respect
to medical and surgical
benefits and mental health and
substance use disorder benefits
under the plan; and
(III) for both the plan year
upon which a cost exemption is
sought and the year prior, the
actual total costs of coverage
with respect to mental health
and substance use disorder
benefits under the plan.
(iii) Confidentiality.--A
notification to the Secretary under
clause (i) shall be confidential. The
Secretary shall make available, upon
request and on not more than an annual
basis, an anonymous itemization of such
notifications, that includes--
(I) a breakdown of States by
the size and type of employers
submitting such notification;
and
(II) a summary of the data
received under clause (ii).
(F) Audits by appropriate agencies.--To
determine compliance with this paragraph, the
Secretary may audit the books and records of a
group health plan or health insurance issuer
relating to an exemption, including any
actuarial reports prepared pursuant to
subparagraph (C), during the 6 year period
following the notification of such exemption
under subparagraph (E). A State agency
receiving a notification under subparagraph (E)
may also conduct such an audit with respect to
an exemption covered by such notification.
(d) Separate Application to Each Option Offered.--In the case
of a group health plan that offers a participant or beneficiary
two or more benefit package options under the plan, the
requirements of this section shall be applied separately with
respect to each such option.
(e) Definitions.--For purposes of this section--
(1) Aggregate lifetime limit.--The term ``aggregate
lifetime limit'' means, with respect to benefits under
a group health plan or health insurance coverage, a
dollar limitation on the total amount that may be paid
with respect to such benefits under the plan or health
insurance coverage with respect to an individual or
other coverage unit.
(2) Annual limit.--The term ``annual limit'' means,
with respect to benefits under a group health plan or
health insurance coverage, a dollar limitation on the
total amount of
benefits that may be paid with respect to such benefits
in a 12-month period under the plan or health insurance
coverage with respect to an individual or other
coverage unit.
(3) Medical or surgical benefits.--The term ``medical
or surgical benefits'' means benefits with respect to
medical or surgical services, as defined under the
terms of the plan or coverage (as the case may be), but
does not include mental health or substance use
disorder benefits.
(4) Mental health benefits.--The term ``mental health
benefits'' means benefits with respect to services for
mental health conditions, as defined under the terms of
the plan and in accordance with applicable Federal and
State law.
(5) Substance use disorder benefits.--The term
``substance use disorder benefits'' means benefits with
respect to services for substance use disorders, as
defined under the terms of the plan and in accordance
with applicable Federal and State law.
(f) Secretary Report.--The Secretary shall, by January 1,
2012, and every two years thereafter, submit to the appropriate
committees of Congress a report on compliance of group health
plans (and health insurance coverage offered in connection with
such plans) with the requirements of this section. Such report
shall include the results of any surveys or audits on
compliance of group health plans (and health insurance coverage
offered in connection with such plans) with such requirements
and an analysis of the reasons for any failures to comply.
(g) Notice and Assistance.--The Secretary, in cooperation
with the Secretaries of Health and Human Services and Treasury,
as appropriate, shall publish and widely disseminate guidance
and information for group health plans, participants and
beneficiaries, applicable State and local regulatory bodies,
and the National Association of Insurance Commissioners
concerning the requirements of this section and shall provide
assistance concerning such requirements and the continued
operation of applicable State law. Such guidance and
information shall inform participants and beneficiaries of how
they may obtain assistance under this section, including, where
appropriate, assistance from State consumer and insurance
agencies.
* * * * * * *
----------
INTERNAL REVENUE CODE OF 1986
TITLE 26--INTERNAL REVENUE CODE
Subtitle K--Group Health Plan Requirements
CHAPTER 100--GROUP HEALTH PLAN REQUIREMENTS
Subchapter B--OTHER REQUIREMENTS
* * * * * * *
SEC. 9812. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DISORDER BENEFITS.
(a) In general.--
(1) Aggregate lifetime limits.--In the case of a
group health plan that provides both medical and
surgical benefits and mental health or substance use
disorder benefits--
(A) No lifetime limit.--If the plan does not
include an aggregate lifetime limit on
substantially all medical and surgical
benefits, the plan may not impose any aggregate
lifetime limit on mental health or substance
use disorder benefits.
(B) Lifetime limit.--If the plan includes an
aggregate lifetime limit on substantially all
medical and surgical benefits (in this
paragraph referred to as the ``applicable
lifetime limit''), the plan shall either--
(i) apply the applicable lifetime
limit both to the medical and surgical
benefits to which it otherwise would
apply and to mental health and
substance use disorder benefits and not
distinguish in the application of such
limit between such medical and surgical
benefits and mental health and
substance use disorder benefits; or
(ii) not include any aggregate
lifetime limit on mental health or
substance use disorder benefits that is
less than the applicable lifetime
limit.
(C) Rule in case of different limits.--In the
case of a plan that is not described in
subparagraph (A) or (B) and that includes no or
different aggregate lifetime limits on
different categories of medical and surgical
benefits, the Secretary shall establish rules
under which subparagraph (B) is applied to such
plan with respect to mental health and
substance use disorder benefits by substituting
for the applicable lifetime limit an average
aggregate lifetime limit that is computed
taking into account the weighted average of the
aggregate lifetime limits applicable to such
categories.
(2) Annual limits.--In the case of a group health
plan that provides both medical and surgical benefits
and mental health or substance use disorder benefits--
(A) No annual limit.--If the plan does not
include an annual limit on substantially all
medical and surgical benefits, the plan may not
impose any annual limit on mental health or
substance use disorder benefits.
(B) Annual limit.--If the plan includes an
annual limit on substantially all medical and
surgical benefits (in this paragraph referred
to as the ``applicable annual limit''), the
plan shall either--
(i) apply the applicable annual limit
both to medical and surgical benefits
to which it otherwise would apply and
to mental health and substance use
disorder benefits and not distinguish
in the application of such limit
between such medical and surgical
benefits and mental health and
substance use disorder benefits; or
(ii) not include any annual limit on
mental health or substance use disorder
benefits that is less than the
applicable annual limit.
(C) Rule in case of different limits.--In the
case of a plan that is not described in
subparagraph (A) or (B) and that includes no or
different annual limits on different categories
of medical and surgical benefits, the Secretary
shall establish rules under which subparagraph
(B) is applied to such plan with respect to
mental health and substance use disorder
benefits by substituting for the applicable
annual limit an average annual limit that is
computed taking into account the weighted
average of the annual limits applicable to such
categories.
(3) Financial requirements and treatment
limitations.--
(A) In general.--In the case of a group
health plan that provides both medical and
surgical benefits and mental health or
substance use disorder benefits, such plan
shall ensure that--
(i) the financial requirements
applicable to such mental health or
substance use disorder benefits are no
more restrictive than the predominant
financial requirements applied to
substantially all medical and surgical
benefits covered by the plan, and there
are no separate cost sharing
requirements that are applicable only
with respect to mental health or
substance use disorder benefits; and
(ii) the treatment limitations
applicable to such mental health or
substance use disorder benefits are no
more restrictive than the predominant
treatment limitations applied to
substantially all medical and surgical
benefits covered by the plan and there
are no separate treatment limitations
that are applicable only with respect
to mental health or substance use
disorder benefits.
(B) Definitions.--In this paragraph:
(i) Financial requirement.--The term
``financial requirement'' includes
deductibles, copayments, coinsurance,
and out-of-pocket expenses, but
excludes an aggregate lifetime limit
and an annual limit subject to
paragraphs (1) and (2).
(ii) Predominant.--A financial
requirement or treatment limit is
considered to be predominant if it is
the most common or frequent of such
type of limit or requirement.
(iii) Treatment limitation.--The term
``treatment limitation'' includes
limits on the frequency of treatment,
number of visits, days of coverage, or
other similar limits on the scope or
duration of treatment.
(4) Availability of plan information.--The criteria
for medical necessity determinations made under the
plan with respect to mental health or substance use
disorder benefits shall be made available by the plan
administrator in accordance with regulations to any
current or potential participant, beneficiary, or
contracting provider upon request. The reason for any
denial under the plan of reimbursement or payment for
services with respect to mental health or substance use
disorder benefits in the case of any participant or
beneficiary shall, on request or as otherwise required,
be made available by the plan administrator to the
participant or beneficiary in accordance with
regulations.
(5) Out-of-network providers.--In the case of a plan
that provides both medical and surgical benefits and
mental health or substance use disorder benefits, if
the plan provides coverage for medical or surgical
benefits provided by out-of-network providers, the plan
shall provide coverage for mental health or substance
use disorder benefits provided by out-of-network
providers in a manner that is consistent with the
requirements of this section.
(b) Construction.--Nothing in this section shall be
construed--
(1) as requiring a group health plan to provide any
mental health or substance use disorder benefits; or
(2) in the case of a group health plan that provides
mental health or substance use disorder benefits, as
affecting the terms and conditions of the plan relating
to such benefits under the plan, except as provided in
subsection (a).
(c) Exemptions.--
(1) Small employer exemption.--
(A) In general.--This section shall not apply
to any group health plan for any plan year of a
small employer.
(B) Small employer.--For purposes of
subparagraph (A), the term ``small employer''
means, with respect to a calendar year and a
plan year, an employer who employed an average
of at least 2 (or 1 in the case of an employer
residing in a State that permits small groups
to include a single individual) but not more
than 50 employees on business days during the
preceding calendar year. For purposes of the
preceding sentence, all persons treated as a
single employer under subsection (b), (c), (m),
or (o) of section 414 shall be treated as 1
employer and rules similar to rules of
subparagraphs (B) and (C) of section
4980D(d)(2) shall apply.
(2) Cost exemption.--
(A) In general.--With respect to a group
health plan, if the application of this section
to such plan results in an increase for the
plan year involved of the actual total costs of
coverage with respect to medical and surgical
benefits and mental health and substance use
disorder benefits under the plan (as determined
and certified under subparagraph (C)) by an
amount that exceeds the applicable percentage
described in subparagraph (B) of the actual
total plan costs, the provisions of this
section shall not apply to such plan during the
following plan year, and such exemption shall
apply to the plan for 1 plan year. An employer
may elect to continue to apply mental health
and substance use disorder parity pursuant to
this section with respect to the group health
plan involved regardless of any increase in
total costs.
(B) Applicable percentage.--With respect to a
plan, the applicable percentage described in
this subparagraph shall be--
(i) 2 percent in the case of the
first plan year in which this section
is applied; and
(ii) 1 percent in the case of each
subsequent plan year.
(C) Determinations by actuaries.--
Determinations as to increases in actual costs
under a plan for purposes of this section shall
be made and certified by a qualified and
licensed actuary who is a member in good
standing of the American Academy of Actuaries.
All such determinations shall be in a written
report prepared by the actuary. The report, and
all underlying documentation relied upon by the
actuary, shall be maintained by the group
health plan for a period of 6 years following
the notification made under subparagraph (E).
(D) 6-month determinations.--If a group
health plan seeks an exemption under this
paragraph, determinations under subparagraph
(A) shall be made after such plan has complied
with this section for the first 6 months of the
plan year involved.
(E) Notification.--
(i) In general.--A group health plan
that, based upon a certification
described under subparagraph (C),
qualifies for an exemption under this
paragraph, and elects to implement the
exemption, shall promptly notify the
Secretary, the appropriate State
agencies, and participants and
beneficiaries in the plan of such
election.
(ii) Requirement.--A notification to
the Secretary under clause (i) shall
include--
(I) a description of the
number of covered lives under
the plan involved at the time
of the notification, and as
applicable, at the time of any
prior election of the cost-
exemption under this paragraph
by such plan;
(II) for both the plan year
upon which a cost exemption is
sought and the year prior, a
description of the actual total
costs of coverage with respect
to medical and surgical
benefits and mental health and
substance use disorder benefits
under the plan; and
(III) for both the plan year
upon which a cost exemption is
sought and the year prior, the
actual total costs of coverage
with respect to mental health
and substance use disorder
benefits under the plan.
(iii) Confidentiality.--A
notification to the Secretary under
clause (i) shall be confidential. The
Secretary shall make available, upon
request and on not more than an annual
basis, an anonymous itemization of such
notifications, that includes--
(I) a breakdown of States by
the size and type of employers
submitting such notification;
and
(II) a summary of the data
received under clause (ii).
(F) Audits by appropriate agencies.--To
determine compliance with this paragraph, the
Secretary may audit the books and records of a
group health plan relating to an exemption,
including any actuarial reports prepared
pursuant to subparagraph (C), during the 6 year
period following the notification of such
exemption under subparagraph (E). A State
agency receiving a notification under
subparagraph (E) may also conduct such an audit
with respect to an exemption covered by such
notification.
(d) Separate application to each option offered.--In the case
of a group health plan that offers a participant or beneficiary
two or more benefit package options under the plan, the
requirements of this section shall be applied separately with
respect to each such option.
(e) Definitions.--For purposes of this section:
(1) Aggregate lifetime limit.--The term ``aggregate
lifetime limit'' means, with respect to benefits under
a group health plan, a dollar limitation on the total
amount that may be paid with respect to such benefits
under the plan with respect to an individual or other
coverage unit.
(2) Annual limit.--The term ``annual limit'' means,
with respect to benefits under a group health plan, a
dollar limitation on the total amount of benefits that
may be paid with respect to such benefits in a 12-month
period under the plan with respect to an individual or
other coverage unit.
(3) Medical or surgical benefits.--The term ``medical
or surgical benefits'' means benefits with respect to
medical or surgical services, as defined under the
terms of the plan, but does not include mental health
or substance use disorder benefits.
(4) Mental health benefits.--The term ``mental health
benefits'' means benefits with respect to services for
mental health conditions, as defined under the terms of
the plan and in accordance with applicable Federal and
State law.
(5) Substance use disorder benefits.--The term
``substance use disorder benefits'' means benefits with
respect to services for substance use disorders, as
defined under the terms of the plan and in accordance
with applicable Federal and State law.
(6) Compliance program guidance document.--
(A) In general.--Not later than 12 months
after the date of enactment of the Helping
Families in Mental Health Crisis Reform Act of
2016, the Secretary, the Secretary of Labor,
and the Secretary of Health and Human Services,
in consultation with the Inspector General of
the Department of Health and Human Services,
the Inspector General of the Department of
Labor, and the Inspector General of the
Department of the Treasury, shall issue a
compliance program guidance document to help
improve compliance with this section, section
712 of the Employee Retirement Income Security
Act of 1974, and section 2799A-1 of the Public
Health Service Act, as applicable. In carrying
out this paragraph, the Secretaries may take
into consideration the 2016 publication of the
Department of Health and Human Services and the
Department of Labor, entitled ``Warning Signs -
Plan or Policy Non-Quantitative Treatment
Limitations (NQTLs) that Require Additional
Analysis to Determine Mental Health Parity
Compliance''.
(B) Examples illustrating compliance and
noncompliance.--
(i) In general.--The compliance
program guidance document required
under this paragraph shall provide
illustrative, de-identified examples
(that do not disclose any protected
health information or individually
identifiable information) of previous
findings of compliance and
noncompliance with this section,
section 712 of the Employee Retirement
Income Security Act of 1974, or section
2799A-1 of the Public Health Service
Act, as applicable, based on
investigations of violations of such
sections, including--
(I) examples illustrating
requirements for information
disclosures and nonquantitative
treatment limitations; and
(II) descriptions of the
violations uncovered during the
course of such investigations.
(ii) Nonquantitative treatment
limitations.--To the extent that any
example described in clause (i)
involves a finding of compliance or
noncompliance with regard to any
requirement for nonquantitative
treatment limitations, the example
shall provide sufficient detail to
fully explain such finding, including a
full description of the criteria
involved for approving medical and
surgical benefits and the criteria
involved for approving mental health
and substance use disorder benefits.
(iii) Access to additional
information regarding compliance.--In
developing and issuing the compliance
program guidance document required
under this paragraph, the Secretaries
specified in subparagraph (A)--
(I) shall enter into
interagency agreements with the
Inspector General of the
Department of Health and Human
Services, the Inspector General
of the Department of Labor, and
the Inspector General of the
Department of the Treasury to
share findings of compliance
and noncompliance with this
section, section 712 of the
Employee Retirement Income
Security Act of 1974, or
section 2799A-1 of the Public
Health Service Act, as
applicable; and
(II) shall seek to enter into
an agreement with a State to
share information on findings
of compliance and noncompliance
with this section, section 712
of the Employee Retirement
Income Security Act of 1974, or
section 2799A-1 of the Public
Health Service Act, as
applicable.
(C) Recommendations.--The compliance program
guidance document shall include recommendations
to advance compliance with this section,
section 712 of the Employee Retirement Income
Security Act of 1974, or section 2799A-1 of the
Public Health Service Act, as applicable, and
encourage the development and use of internal
controls to monitor adherence to applicable
statutes, regulations, and program
requirements. Such internal controls may
include illustrative examples of
nonquantitative treatment limitations on mental
health and substance use disorder benefits,
which may fail to comply with this section,
section 712 of the Employee Retirement Income
Security Act of 1974, or section 2799A-1 of the
Public Health Service Act, as applicable, in
relation to nonquantitative treatment
limitations on medical and surgical benefits.
(D) Updating the compliance program guidance
document.--The Secretary, the Secretary of
Labor, and the Secretary of Health and Human
Services, in consultation with the Inspector
General of the Department of Health and Human
Services, the Inspector General of the
Department of Labor, and the Inspector General
of the Department of the Treasury, shall update
the compliance program guidance document every
2 years to include illustrative, de-identified
examples (that do not disclose any protected
health information or individually identifiable
information) of previous findings of compliance
and noncompliance with this section, section
712 of the Employee Retirement Income Security
Act of 1974, or section 2799A-1 of the Public
Health Service Act, as applicable.
(7) Additional guidance.--
(A) In general.--Not later than 12 months
after the date of enactment of the Helping
Families in Mental Health Crisis Reform Act of
2016, the Secretary, the Secretary of Labor,
and the Secretary of Health and Human Services
shall issue guidance to group health plans and
health insurance issuers offering group or
individual health insurance coverage to assist
such plans and issuers in satisfying the
requirements of this section, section 712 of
the Employee Retirement Income Security Act of
1974, or section 2799A-1 of the Public Health
Service Act, as applicable.
(B) Disclosure.--
(i) Guidance for plans and issuers.--
The guidance issued under this
paragraph shall include clarifying
information and illustrative examples
of methods that group health plans and
health insurance issuers offering group
or individual health insurance coverage
may use for disclosing information to
ensure compliance with the requirements
under this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 2799A-1 of the
Public Health Service Act, (and any
regulations promulgated pursuant to
such sections, as applicable).
(ii) Documents for participants,
beneficiaries, contracting providers,
or authorized representatives.--The
guidance issued under this paragraph
shall include clarifying information
and illustrative examples of methods
that group health plans and health
insurance issuers offering group or
individual health insurance coverage
may use to provide any participant,
beneficiary, contracting provider, or
authorized representative, as
applicable, with documents containing
information that the health plans or
issuers are required to disclose to
participants, beneficiaries,
contracting providers, or authorized
representatives to ensure compliance
with this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 2799A-1 of the
Public Health Service Act, as
applicable, compliance with any
regulation issued pursuant to such
respective section, or compliance with
any other applicable law or regulation.
Such guidance shall include information
that is comparative in nature with
respect to--
(I) nonquantitative treatment
limitations for both medical
and surgical benefits and
mental health and substance use
disorder benefits;
(II) the processes,
strategies, evidentiary
standards, and other factors
used to apply the limitations
described in subclause (I); and
(III) the application of the
limitations described in
subclause (I) to ensure that
such limitations are applied in
parity with respect to both
medical and surgical benefits
and mental health and substance
use disorder benefits.
(C) Nonquantitative treatment limitations.--
The guidance issued under this paragraph shall
include clarifying information and illustrative
examples of methods, processes, strategies,
evidentiary standards, and other factors that
group health plans and health insurance issuers
offering group or individual health insurance
coverage may use regarding the development and
application of nonquantitative treatment
limitations to ensure compliance with this
section, section 712 of the Employee Retirement
Income Security Act of 1974, or section 2799A-1
of the Public Health Service Act, as
applicable, (and any regulations promulgated
pursuant to such respective section),
including--
(i) examples of methods of
determining appropriate types of
nonquantitative treatment limitations
with respect to both medical and
surgical benefits and mental health and
substance use disorder benefits,
including nonquantitative treatment
limitations pertaining to--
(I) medical management
standards based on medical
necessity or appropriateness,
or whether a treatment is
experimental or investigative;
(II) limitations with respect
to prescription drug formulary
design; and
(III) use of fail-first or
step therapy protocols;
(ii) examples of methods of
determining--
(I) network admission
standards (such as
credentialing); and
(II) factors used in provider
reimbursement methodologies
(such as service type,
geographic market, demand for
services, and provider supply,
practice size, training,
experience, and licensure) as
such factors apply to network
adequacy;
(iii) examples of sources of
information that may serve as
evidentiary standards for the purposes
of making determinations regarding the
development and application of
nonquantitative treatment limitations;
(iv) examples of specific factors,
and the evidentiary standards used to
evaluate such factors, used by such
plans or issuers in performing a
nonquantitative treatment limitation
analysis;
(v) examples of how specific
evidentiary standards may be used to
determine whether treatments are
considered experimental or
investigative;
(vi) examples of how specific
evidentiary standards may be applied to
each service category or classification
of benefits;
(vii) examples of methods of reaching
appropriate coverage determinations for
new mental health or substance use
disorder treatments, such as evidence-
based early intervention programs for
individuals with a serious mental
illness and types of medical management
techniques;
(viii) examples of methods of
reaching appropriate coverage
determinations for which there is an
indirect relationship between the
covered mental health or substance use
disorder benefit and a traditional
covered medical and surgical benefit,
such as residential treatment or
hospitalizations involving voluntary or
involuntary commitment; and
(ix) additional illustrative examples
of methods, processes, strategies,
evidentiary standards, and other
factors for which the Secretary
determines that additional guidance is
necessary to improve compliance with
this section, section 712 of the
Employee Retirement Income Security Act
of 1974, or section 2799A-1 of the
Public Health Service Act, as
applicable.
(D) Public comment.--Prior to issuing any
final guidance under this paragraph, the
Secretary shall provide a public comment period
of not less than 60 days during which any
member of the public may provide comments on a
draft of the guidance.
(8) Compliance requirements.--
(A) Nonquantitative treatment limitation
(nqtl) requirements.--Beginning 45 days after
the date of enactment of this paragraph, in the
case of a group health plan that provides both
medical and surgical benefits and mental health
or substance use disorder benefits and that
imposes nonquantitative treatment limitations
(referred to in this section as ``NQTL'') on
mental health or substance use disorder
benefits, the plan shall perform comparative
analyses of the design and application of NQTLs
in accordance with subparagraph (B), and make
available to the applicable State authority
(or, as applicable, the Secretary), upon
request, the following information:
(i) The specific plan terms regarding
the NQTL, that applies to such plan or
coverage, and a description of all
mental health or substance use disorder
and medical or surgical benefits to
which it applies in each respective
benefits classification.
(ii) The factors used to determine
that the NQTL will apply to mental
health or substance use disorder
benefits and medical or surgical
benefits.
(iii) The evidentiary standards used
for the factors identified in clause
(ii), when applicable, provided that
every factor shall be defined and any
other source or evidence relied upon to
design and apply the NQTL to mental
health or substance use disorder
benefits and medical or surgical
benefits.
(iv) The comparative analyses
demonstrating that the processes,
strategies, evidentiary standards, and
other factors used to design the NQTL,
as written, and the operation processes
and strategies as written and in
operation that are used to apply the
NQTL for mental health or substance use
disorder benefits are comparable to,
and are applied no more stringently
than, the processes, strategies,
evidentiary standards, and other
factors used to design the NQTL, as
written, and the operation processes
and strategies as written and in
operation that are used to apply the
NQTL to medical or surgical benefits.
(v) A disclosure of the specific
findings and conclusions reached by the
plan that the results of the analyses
described in this subparagraph indicate
that the plan is in compliance with
this section.
(B) Secretary request process.--
(i) Submission upon request.--The
Secretary shall request that a group
health plan submit the comparative
analyses described in subparagraph (A)
for plans that involve potential
violations of this section or
complaints regarding noncompliance with
this section that concern NQTLs and any
other instances in which the Secretary
determines appropriate. The Secretary
shall request not fewer than 20 such
analyses per year.
(ii) Additional information.--In
instances in which the Secretary has
concluded that the plan has not
submitted sufficient information for
the Secretary to review the comparative
analyses described in subparagraph (A),
as requested under clause (i), the
Secretary shall specify to the plan the
information the plan or coverage must
submit to be responsive to the request
under clause (i) for the Secretary to
review the comparative analyses
described in subparagraph(A) for
compliance with this section. Nothing
in this paragraph shall require the
Secretary to conclude that a plan is in
compliance with this section solely
based upon the inspection of the
comparative analyses described in
subparagraph (A), as requested under
clause (i).
(iii) Required action.--
(I) In general.--In instances
in which the Secretary has
reviewed the comparative
analyses described in
subparagraph (A), as requested
under clause (i), and
determined that the plan is not
in compliance with this
section, the plan--
(aa) shall specify to
the Secretary the
actions the plan will
take to be in
compliance with this
section and provide to
the Secretary
comparative analyses
described in
subparagraph (A) that
demonstrate compliance
with this section not
later than 45 days
after the initial
determination by the
Secretary that the plan
is not in compliance;
and
(bb) following the
45-day corrective
action period under
item (aa), if the
Secretary determines
that the plan still is
not in compliance with
this section, not later
than 7 days after such
determination, shall
notify all individuals
enrolled in the plan or
coverage that the plan
has been determined to
be not in compliance
with this section.
(II) Exemption from
disclosure.--Documents or
communications produced in
connection with the Secretary's
recommendations to the plan or
coverage shall not be subject
to disclosure pursuant to
section 552 of title 5, United
States Code.
(iv) Report.--Not later than 1 year
after the date of enactment of this
paragraph, and not later than October 1
of each year thereafter, the Secretary
shall submit to Congress, and make
publicly available, a report that
contains--
(I) a summary of the
comparative analyses requested
under clause (i), including the
identity of each plan that is
determined to be not in
compliance after the final
determination by the Secretary
described in clause
(iii)(I)(bb);
(II) the Secretary's
conclusions as to whether each
plan submitted sufficient
information for the Secretary
to review the comparative
analyses requested under clause
(i) for compliance with this
section;
(III) for each plan that did
submit sufficient information
for the Secretary to review the
comparative analyses requested
under clause (i), the
Secretary's conclusions as to
whether and why the plan or
coverage is in compliance with
the requirements under this
section;
(IV) the Secretary's
specifications described in
clause (ii) for each plan that
the Secretary determined did
not submit sufficient
information for the Secretary
to review the comparative
analyses requested under clause
(i) for compliance with this
section; and
(V) the Secretary's
specifications described in
clause (iii) of the actions
each plan hat the Secretary
determined is not in compliance
with this section must take to
be in compliance with this
section, including the reason
why the Secretary determined
the plan or coverage is not in
compliance.
(C) Compliance program guidance document
update process.--
(i) In general.--The Secretary shall
include instances of noncompliance that
the Secretary discovers upon reviewing
the comparative analyses requested
under subparagraph (B)(i) in the
compliance program guidance document
described in paragraph (6), as it is
updated every 2 years, except that such
instances shall not disclose any
protected health information or
individually identifiable information.
(ii) Guidance and regulations.--Not
later than 18 months after the date of
enactment of this paragraph, the
Secretary shall finalize any draft or
interim guidance and regulations
relating to mental health parity under
this section. Such draft guidance shall
include guidance to clarify the process
and timeline for current and potential
participants and beneficiaries (and
authorized representatives and health
care providers of such participants and
beneficiaries) with respect to plans to
file complaints of such plans or
issuers being in violation of this
section, including guidance, by plan
type, on the relevant State, regional,
or national office with which such
complaints should be filed.
(iii) State.--The Secretary shall
share information on findings of
compliance and noncompliance discovered
upon reviewing the comparative analyses
requested under subparagraph (B)(i)
with the State where the group health
plan is located or the State where the
health insurance issuer is licensed to
do business for coverage offered by a
health insurance issuer in the group
market, in accordance with paragraph
(6)(B)(iii)(II).
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