[Federal Register Volume 62, Number 123 (Thursday, June 26, 1997)]
[Proposed Rules]
[Pages 34604-34606]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-16770]
[[Page 34603]]
_______________________________________________________________________
Part VII
Department of Labor
Pension and Welfare Benefits Administration
29 CFR Chapter XXV
Department of Health and Human Services
Health Care Financing Administration
45 CFR Subtitle A, Subchapter B
_______________________________________________________________________
Mental Health Parity and Newborns' and Mothers' Health Protection;
Proposed Rule
Federal Register / Vol. 62, No. 123 / Thursday, June 26, 1997 /
Proposed Rules
[[Page 34604]]
DEPARTMENT OF LABOR
Pension and Welfare Benefits Administration
29 CFR Chapter XXV
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Health Care Financing Administration
45 CFR Subtitle A, Subchapter B
Mental Health Parity and Newborns' and Mothers' Health Protection
AGENCIES: Pension and Welfare Benefits Administration, Department of
Labor; and Health Care Financing Administration, Department of Health
and Human Services.
ACTION: Solicitation of comments.
-----------------------------------------------------------------------
SUMMARY: This document is a request for comments regarding issues under
the Mental Health Parity Act of 1996 (MHPA) and the Newborns' and
Mothers' Health Protection Act of 1996 (NMHPA). The Department of Labor
and the Department of Health and Human Services (collectively, the
Departments) have received comments from the public on a number of
issues arising under both MHPA and NMHPA. Further comments from the
public are welcome.
DATES: The Departments have requested that comments be submitted on or
before July 28, 1997.
ADDRESSES: Written comments should be submitted with a signed original
and 2 copies to the Pension Welfare Benefits Administration (PWBA) at
the address specified below. PWBA will provide copies to the Department
of Health and Human Services for its consideration. All comments will
be available for public inspection and copying in their entirety.
Comments should be sent to: Office of Regulations and Interpretations,
Pension and Welfare Benefits Administration, Room N-5669, U.S.
Department of Labor, 200 Constitution Ave., NW., Washington, DC 20210,
Attn: MHPA/NMHPA Solicitation of Comments.
All comments received will be available for public inspection at
the Public Disclosure Room, Pension and Welfare Benefits
Administration, U.S. Department of Labor, Room N-5507, 200 Constitution
Ave., NW., Washington, DC 20210. Comments received timely will also be
available for public inspection as they are received, generally
beginning approximately 3 weeks after publication of a document, in
Room 309-G of the Department of Health and Human Services offices at
200 Independence Avenue, SW., Washington, DC, on Monday through Friday
of each week from 8:30 a.m. to 5 p.m. (phone (202) 690-7890).
FOR FURTHER INFORMATION CONTACT: Amy Scheingold, Department of Labor,
Pension and Welfare Benefits Administration, at 202-219-4377 (not a
toll-free number); or Therese Klitenic, Health Care Financing
Administration, at 410-786-5942 for inquiries regarding MHPA, or
Suzanne Long, Health Care Financing Administration, at 410-786-0970 for
inquiries regarding NMHPA (not toll-free numbers).
SUPPLEMENTARY INFORMATION:
Background
Mental Health Parity Act of 1996
The Mental Health Parity Act of 1996 (MHPA or the Act) was enacted
on September 26, 1996 (Pub. L. 104-204). MHPA amended the Public Health
Service Act (PHSA) and the Employee Retirement Income Security Act of
1974, as amended, (ERISA) to provide for parity in the application of
limits on certain mental health benefits with limits on medical and
surgical benefits. Health coverage is regulated in part by the federal
government, under the PHSA and ERISA, and other federal provisions
including the Internal Revenue Code (Code), and in part by the States.
MHPA provisions are set forth in Title XXVII of the PHSA and Part 7
of Subtitle B of Title I of ERISA. These provisions are not currently
contained in the Code. However, the Conference Report states Congress's
intention to make conforming changes to the Code as soon as possible in
order to implement these provisions under the Code. MHPA provisions are
intended to provide parity of mental health benefits with medical and
surgical benefits under a group health plan in the application of
aggregate dollar lifetime limits and annual dollar limits. A plan
providing both medical and surgical benefits and mental health benefits
may not impose an aggregate lifetime expenditure limit or annual
expenditure limit (as dollars) on mental health benefits if it does not
impose such a limit on substantially all of the medical and surgical
benefits.
If a group health plan does impose an aggregate lifetime limit or
annual limit on medical and surgical benefits, the plan cannot impose
any such limit on mental health benefits that is less than that on the
medical and surgical benefits. In the case of a plan that has different
aggregate lifetime limits, or annual limits, on different categories of
medical and surgical benefits, the Departments shall establish rules to
calculate an average aggregate lifetime limit, or annual limit, for
mental health benefits that is computed taking into account the
weighted average of the limits applicable to the different categories.
MHPA does not require a plan or coverage to provide any mental
health benefits. Further, MHPA provides that nothing in the Act shall
be construed as affecting the terms or conditions (including cost
sharing, limits on numbers of visits or days of coverage, and
requirements relating to medical necessity) relating to the amount,
duration or scope of mental health benefits under such plans or
coverage, except as specifically provided regarding parity in the
imposition of aggregate lifetime limits and annual limits for mental
health benefits. MHPA requirements do not apply to benefits for
substance abuse or chemical dependency.
MHPA also provides two exemptions from its parity requirements. The
first exemption is for small employers (defined as an employer who
employed an average of at least 2 but not more than 50 employees on
business days during the preceding calendar year and who employs at
least 2 employees on the first day of the plan year). The second
exemption is for group health plans if the application of these
provisions results in an increase in the cost under the plan or
coverage of at least one percent.
MHPA provisions are effective for plan years beginning on or after
January 1, 1998. The Act includes a sunset provision under which MHPA
requirements do not apply to benefits for services furnished on or
after September 30, 2001. Accordingly, the Departments are working
actively to develop and promulgate the necessary regulations prior to
the effective date of the MHPA provisions.
Newborns' and Mothers' Health Protection Act of 1996
The Newborns' and Mothers' Health Protection Act of 1996 (NMHPA)
was enacted on September 26, 1996 (Pub. L. 104-204). NMHPA amended the
PHSA and ERISA to provide protection for mothers and their newborn
children with regard to the length of hospital stays following the
birth of a child. NMHPA applies to health coverage offered in the large
and small group markets, and the individual market.
NMHPA provisions are set forth in Title XXVII of the PHSA and Part
7 of Subtitle B of Title I of ERISA. NMHPA provisions are not currently
contained in the Code. These provisions include new rules relating to
the minimum time period a mother and a newborn child can spend in the
hospital in connection
[[Page 34605]]
with the birth of a child. Under NMHPA, group health plans, insurance
companies, and health maintenance organizations (HMOs) offering health
coverage for hospital stays in connection with the birth of a child
must provide health coverage for a minimum period of time. For example,
NMHPA provides that coverage for a hospital stay following a normal
vaginal delivery generally may not be limited to less than 48 hours for
each the mother and the newborn child. Health coverage for a hospital
stay in connection with childbirth following a caesarean section
generally may not be limited to less than 96 hours for the mother and
the newborn child.
NMHPA's requirements only apply to group health plans, insurance
companies, and HMOs that choose to provide insurance coverage for a
hospital stay in connection with childbirth. NMHPA does not require
such entities to provide coverage for hospital stays in connection with
the birth of a child. In addition, NMHPA does not prevent a group
health plan, insurance company, or HMO from imposing deductibles,
coinsurance, or other cost-sharing measures for health benefits
relating to hospital stays in connection with childbirth as long as
such cost-sharing measures are not greater than those imposed on any
preceding portion of a hospital stay.
NMHPA prohibits certain compensation arrangements. Specifically,
NMHPA prohibits a group health plan, insurance company, or HMO from
providing monetary payments or rebates to mothers to encourage such
mothers to accept less than the minimum protections under the law;
prohibits penalizing or otherwise reducing or limiting the
reimbursement of an attending provider because such provider provided
care to an individual participant or beneficiary in accordance with the
law; and prohibits providing incentives (monetary or otherwise) to an
attending provider to induce such provider to provide care to an
individual participant or beneficiary in a manner inconsistent with the
law.
The requirements under NMHPA apply to plans and issuers in the
group market for plan years beginning on or after January 1, 1998. For
issuers in the individual market, the requirements apply with respect
to health insurance coverage offered, sold, issued, renewed, in effect,
or operated in the individual market on or after January 1, 1998.
Accordingly, the Departments are working actively to develop and
promulgate the necessary regulations prior to the effective date of the
NMHPA provisions.
Economic Analysis/Paperwork Reduction Act Information/Regulatory
Flexibility Act Information
Analysis under Executive Order 12866 requires that the Departments
quantify the costs and benefits of the proposed regulations and the
alternatives considered using the guidance provided by the Office of
Management and Budget (OMB). These costs and benefits are not limited
to the Federal government, but pertain to the nation as a whole.
The Departments' analysis under the Regulatory Flexibility Act will
need to include, among other things, an estimate of the number of small
entities subject to the regulations (for this purpose, plans,
employers, and issuers and, in some contexts small governmental
entities), the expense of the reporting and other compliance
requirements (including the expense of using professional expertise),
and a description of regulatory alternatives that minimize impact on
small entities yet achieve the regulatory purpose.
Paperwork Reduction Act analysis requires that the Departments
estimate how many ``respondents'' will be required to comply with the
``collection of information'' aspects of the regulations and how much
time and cost will be incurred as a result. A collection of information
includes record-keeping, reporting to governmental agencies, and third-
party disclosures, such as the certification process.
The Departments are requesting comments that may contribute to the
impact analysis that will be performed pursuant to the above mentioned
requirements.
Comments
Comments have been received from the public on a number of issues
arising under MHPA and NMHPA. The purpose of this announcement is to
advise the public that further comments are welcome. In order to assist
interested parties in responding, this solicitation of comments
describes specific areas in which the Departments are particularly
interested. The Departments, however, also request comments and
suggestions concerning any area or issue pertinent to the assessment
and development of regulatory guidance regarding MHPA and NMHPA.
Comments should reference the appropriate question number to aid the
Departments in analyzing submissions.
Specific Areas With Respect to MHPA in Which the Departments Are
Interested Include the Following
Group health plans are exempt from the provisions of MHPA if the
application of its provisions results in an increase in the cost under
the plan or coverage of at least one percent.
With respect to this exemption:
1(a) Should the exemption be contingent on formal application and
agency approval or some other less formal process such as record
keeping and third party disclosure?
1(b) Whether the exemption process is formal or informal, what
documentation should be required to support an exemption from MHPA and
how should such documentation be subject to independent verification?
1(c) If the exemption process is not contingent on formal
application and agency approval, what additional consumer protections
should be developed as part of implementing the statute?
2(a) Should the exemption be available based on costs which are
prospective, retrospective, or both?
2(b) If prospective, how should the costs be estimated?
2(c) If retrospective, how should costs be measured?
2(d) Should the added costs be calculated from the baseline of no
mental health care coverage or current practice, where some coverage is
offered but falls short of parity?
3 Should the exemption determinations be made on an annual basis?
In the case of a plan that has different aggregate lifetime limits,
or annual limits, on different categories of medical and surgical
benefits, MHPA requires the Departments to establish rules to calculate
an average aggregate lifetime limit or annual limit for mental health
benefits that is computed taking into account the weighted average of
such limit applicable to the different categories. With regard to these
provisions:
4 How should the weighted average of the limits applicable to the
different categories of medical and surgical benefits be computed?
Specific Areas With Respect to NMHPA in Which the Departments Are
Interested Include the Following
5 What compensation arrangements should be identified as
inappropriate under NMHPA? Please provide specific examples of such
arrangements.
6 What issues or concerns should be taken into consideration for
establishing how to measure 48 and 96 hours (e.g., when should the 48
or 96 hours begin)?
[[Page 34606]]
7 What issues or concerns should be taken into consideration in
defining ``attending provider''?
8 What type of benefits should be considered ``in connection with
a childbirth''?
Specific Areas with Respect to the Departments' Responsibilities
and Analysis Under Executive Order 12866, Paperwork Reduction Act, and
Regulatory Flexibility Act in Which the Departments Are Interested
Include:
9 What amendments are plans likely to make in response to MHPA and
NMHPA, including any amendments designed to offset compliance costs?
10(a) What will be the costs and benefits of compliance with the
NMHPA and the MHPA?
10(b) How should these costs and benefits be defined?
10(c) How will these costs and benefits vary with size and other
characteristics of plans?
10(d) Would differences in these costs and benefits by plan size
or other characteristics suggest additional regulatory flexibility?
11 To what extent are there already voluntary policies in the
industry, and/or State or local mandates in place that meet or exceed
the NMHPA and MHPA mandates?
12(a) What is the prevalence of mental health benefits among large
and small plans?
12(b) Are these benefits typically provided separately from other
health benefits?
12(c) Are mental health benefits self-insured and/or administered
through third party administrators to a greater or lesser extent than
other benefits?
13 What proportion of sponsors of mental health benefits will be
eligible for the one percent cost exemption? What types of plans are
most likely to be eligible?
14 How would costs and benefits of MHPA and NMHPA vary with
alternative policies (including alternative interpretations of the MHPA
one percent cost exemption)? What are the implications for access to
mental health, maternity, or other categories of health insurance?
15 As a measure of benefits, how many people may enjoy greater
access to medically appropriate treatment by providing more equitable
annual or lifetime limits for mental health coverage?
All submitted comments will be made part of the record of the
preceding referred to herein and will be available for public
inspection.
Signed at Washington, DC, this 23rd day of June 1997.
Olena Berg,
Assistant Secretary, Pension and Welfare Benefits Administration,
Department of Labor.
Bruce Vladeck,
Administrator, Health Care Financing Administration, Department of
Health and Human Services.
[FR Doc. 97-16770 Filed 6-25-97; 8:45 am]
BILLING CODE 4510-29-P; 4120-01-P