House Committee Passes Enhanced Mental Health Parity Legislation

July 17, 2020

The House Energy and Commerce Committee approved legislation that would strengthen enforcement of existing mental health parity laws, which can be challenging for employers to meet due to behavioral health provider shortages and lack of adequate networks.

Under the current mental health parity regulations, employers must ensure "non-quantifiable treatment limitations" for mental health benefits are the same as those for medical and surgical benefits.  This includes prior authorization, medical management standards, prescription drug formulary design, standards for provider admission to networks, determination of provider reimbursement rates, requirements for step therapy, and requirements to complete a course of treatment.

The House Committee-passed Strengthening Behavioral Parity Act (H.R. 7539) would:

  • Require employer plans to treat out-of-network behavioral health providers the same as out-of-network medical and surgical providers;

  • Create additional mental health and substance use disorder parity requirements for employer health plans;

  • Require employer plans to provide the criteria for medical necessity determinations to behavioral health providers upon request; and

  • Require the U.S. Department of Labor to conduct random audits of health plans.

Significant mental health coverage issues remain:  According to a recent Milliman report, “The out-of-network utilization rates for behavioral healthcare providers were higher than for medical/surgical providers in all five years (analyzed 2013-17),” and patients are nearly six times more likely to use out-of-network providers for behavioral treatment than those for physical health treatment.

Outlook:  The bill will now move to the full house where it will likely pass. The Association's American Health Policy Institute is collaborating with the Alliance of Health Care Purchaser Coalitions (National Alliance) on an initiative called The Path Forward, focused on driving market-based improvement regarding access to mental health and substance use care. The Path Forward focuses on the issue of mental health parity as well as network access, collaborative care, measurement-based case, and tele-behavioral health.