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In response to the evolving mental health crisis in America, the Departments of Labor, Health and Human Services, and the Treasury have issued new updates to the Mental Health Parity and Addiction Equity Act (MHPAEA). The new MHPAEA proposed rule, first announced in July 2023, strengthens non-quantitative treatment limitations (NQTL) requirements, ensuring behavioral health benefits, including mental health and substance use disorder (MH/SUD) treatments, are provided on par with medical and surgical benefits.

Building on past parity efforts, these regulations introduce important requirements to support greater behavioral health access. Specifically, these updates aim to address disparities in coverage and provide a path for better mental health treatment, especially in areas with unmet needs.

Key changes in the 2024 MHPAEA regulations

The updated regulations reinforce existing standards and introduce additional requirements for group health plans and issuers. Under the 2024 rules, health plans and issuers are obligated to:

• Collect and evaluate data: Group health plans must now regularly gather and assess relevant data on how NQTLs impact access to both MH/SUD benefits and medical/surgical benefits. This is crucial to identifying disparities and ensuring compliance with MHPAEA. The 2023 guidance highlighted that, in many cases, plans failed to properly track how NQTLs affected behavioral health coverage, often resulting in unfair barriers to care.
• Prohibit discriminatory NQTLs: Health plans and issuers are barred from imposing NQTLs that are more restrictive on MH/SUD benefits compared to those on medical and surgical benefits. For instance, practices such as network adequacy, prior authorization requirements, and step therapy protocols must not disproportionately limit access to mental health or substance use services. This builds on the findings from January 2023, where non-compliance with parity standards often led to coverage gaps in behavioral health services.
• Establish new compliance frameworks: The regulations introduce minimum standards for the comparative analyses health plans must perform on their NQTLs. These analyses must detail both how the NQTLs are designed and how they function in operation, aligning with MHPAEA requirements. Health plans are required to make these analyses available to the relevant departments or state authorities upon request. A 2023 survey indicated that many employers and insurers lacked sufficient documentation of how NQTLs were applied, which contributed to ongoing parity violations.
• Address non-compliance: The regulations outline specific corrective actions for health plans and third-party administrators (TPAs) that fail to comply. Should a health plan remain non-compliant after the corrective period, it must notify all affected enrollees. The new rules also implement TPA non-compliance penalties, strengthening enforcement against third-party administrators. The 2023 report noted that employer plans that did not adhere to MHPAEA were often unaware of the penalties associated with non-compliance, underlining the need for clearer regulatory enforcement.

Insights into MH/SUD disparities

The increased demand for mental health services following the COVID-19 pandemic, combined with the shortage of available mental health professionals, has worsened access to care for many individuals. These ongoing challenges were a major motivator behind the MHPAEA’s 2024 focus on network adequacy and enhanced oversight of non-quantitative treatment limitations. The new regulations aim to address these gaps by ensuring that health plans and insurers provide sufficient access to mental health and substance use disorder providers and services.

Another area of focus in the 2024 regulations is the importance of early intervention and preventive mental health care. Research shows that providing timely access to preventive services, such as counseling, therapy, and substance use intervention programs, can significantly reduce long-term treatment costs and improve overall mental well-being. Historically, many health plans limited coverage for these services, creating barriers for individuals seeking care. The updated MHPAEA regulations prioritize the removal of these obstacles, ensuring that preventive mental health care is as readily available as medical care.

Additionally, the disparity in cost-sharing between MH/SUD services and medical/surgical services has long been a concern, with individuals often facing higher out-of-pocket costs for mental health treatment. The 2024 updates address this issue by establishing stronger provisions to align cost-sharing requirements, deductibles, and financial limitations for MH/SUD benefits with those for medical and surgical services, further promoting parity.

Strengthening MHPAEA compliance and employer responsibilities

The new MHPAEA proposed rules enhance network adequacy standards, ensuring MH/SUD provider networks are sufficient to meet the demand for behavioral health services, much like the networks for medical and surgical providers. Insufficient provider networks have been a major barrier to care, leading many individuals to delay treatment or rely on emergency care, which is costlier and less effective.

Employer-sponsored health plans, especially those with over 50 employees, are required to ensure their health plans meet these new standards. This includes incorporating affordable care options for MH/SUD treatment and regularly performing in-depth NQTL comparative analyses. Employers need to collaborate with TPAs and issuers to ensure these standards are met, as non-compliance could lead to costly penalties and reputational harm.

Mental health in the workplace

The average person will spend 90,000 hours at work over their lifetime. This makes the workplace a vital place to provide additional mental health support and resources for Americans, particularly as the nation faces ongoing challenges in the post-COVID era.

Based on the U.S. Surgeon General’s new 2023 framework, employers are encouraged to integrate mental health support into their workplace policies. Here are some key takeaways:

• Protection from harm: Employees need safe physical and psychological environments to thrive. Employers should actively provide mental health support resources.
• Connection and community: Positive social interactions at work help foster a sense of belonging and community, which can protect mental well-being.
• Work-life harmony: Encouraging employees to balance their work and personal lives helps reduce stress and prevent burnout.
• Mattering at work: Feeling valued and appreciated for your contributions can lower workplace stress.
• Growth opportunities: Employers offering opportunities for personal and professional growth foster a positive mental outlook in their employees.

The impact of sleep on mental health

Another vital component of overall mental well-being is sleep. Sleep has a direct impact on cognitive functions such as memory and attention, as well as emotional regulation. Sleep deprivation has been linked to increased levels of anxiety, depression, and psychological distress. Chronic sleep issues can impair one’s ability to handle daily stressors effectively, affecting both personal and professional life.

Here are some tips for improving sleep quality:

• Maintain a consistent sleep schedule.
• Create a quiet, relaxing sleep environment.
• Avoid using electronic devices at least 30 minutes before bedtime.
• Limit alcohol, caffeine, and heavy meals before bed.

Encouraging employees to prioritize healthy sleep habits can significantly improve their mental health, leading to increased workplace satisfaction and productivity.

Christensen Group can help

Navigating these new MHPAEA regulations can be complex, but Christensen Group Insurance is here to help. Our team specializes in designing strategic employee benefits solutions that ensure your health plans are compliant with both federal parity requirements and the updated NQTL mental health parity standards. We also assist in optimizing the use of Employee Assistance Programs (EAPs) and provide guidance on balancing compliance with the Addiction Equity Act, ADA, and FMLA.

Visit our Employee Benefits Strategy & Design page to learn more about how we can support your organization in achieving behavioral health equity. You can also explore how to improve your workplace mental health programs with our articles on Utilizing Employee Assistance Programs and Navigating the ADA and FMLA.

Additional resources

In addition to the 2024 MHPAEA proposed rules, the Departments also released:

• A technical release that requests public feedback on proposed data requirements for limitations related to the composition of a health plan’s or issuer’s network.
• The second MHPAEA comparative analysis report to Congress, as required by federal law.
• A fact sheet on the final rules under the Mental Health Parity and Addiction Equity Act (MHPAEA).
• Requirements related to the Mental Health Parity and Addiction Equity Act.