Proposed Parity Compliance Program Regulations Strengthen Insurers' Obligation Under State & Federal Law
Compliance Programs Must Include Written Policies, Procedures and Methodologies for Identifying and Remediating Improper Practices
During National Minority Mental Health Awareness Month, Governor Andrew M. Cuomo today advanced new regulations requiring insurers to provide equitable coverage for mental health and substance use disorders. The proposed parity compliance program regulations from the New York State Department of Financial Services and Department of Health would strengthen insurers' obligation under both state and federal law to provide comparable coverage for benefits to treat mental health and substance use disorders.
"New Yorkers sacrificed greatly to bend the curve of COVID-19, but with the surge in cases around the country and the mental health challenges many of our fellow New Yorkers face, our work is far from over," Governor Cuomo said. "These new regulations will help people struggling with mental health and substance abuse issues by requiring insurers to provide the coverage and benefits they need, improving access to critical and potentially life-saving services during these unprecedented times."
New York State Superintendent of Financial Services Linda A. Lacewell said, "These proposed regulations will support the many New Yorkers with a mental health condition or substance use disorder by requiring that insurers have robust programs to meet their statutory mental health and substance use disorder parity compliance obligations. This is particularly important now as many are under increased stress as a result of the triple crises in public health, the economy, and civil rights. We will protect the rights of New Yorkers to obtain equal access to mental health treatment and substance use disorder services."
New York State Commissioner of the New York State Department of Health Dr. Howard Zucker said, "These regulations will ensure New Yorkers have access to the mental health and substance use services they need, through their health insurance coverage. We have proposed the same regulations for health plans certified under Public Health Law, like HMOs, so people covered by those plans also have access to these critical services."
New York State Office of Mental Health Commissioner Dr. Ann Sullivan said,“As we recognize Minority Mental Health Month, it is important to note that minority communities have been disproportionately affected by the COVID-19 pandemic, and the stress and anxiety caused by the crisis. Access to insurance coverage can be a matter of life and death, and these new regulations will improve access to coverage and safeguard all New Yorkers rights under state and federal parity laws.
New York State Office of Addiction Services and Supports Commissioner Arlene González-Sánchez said, "Ensuring that all New Yorkers have access to the necessary comprehensive services and supports to address their addiction and mental health needs is vital to our public health care system. These proposed regulations mandating insurers to demonstrate compliance with and report on their obligations will be essential in helping to remove the barriers that prevent too many people from receiving the assistance they need and deserve."
Senator Liz Krueger said, "Parity for mental health, substance use, and eating disorders coverage is the law, but insurance companies have consistently figured out ways to get around it either by outright denying coverage, placing extreme administrative hurdles in the way, or making services too expensive for most people to access. My office has worked with constituents facing thousands of dollars in medical bills just to access care that they are legally entitled to under their insurance plans. I am very pleased that New York State is making a significant effort to improve access to quality mental health care, especially during the pandemic when so many individuals need mental health treatment. This is an important step, but the state must remain vigilant to ensure that insurance providers actually make this care accessible."
Assembly Member Nily Rozic said, "Eating disorders are real, complex, devastating conditions that affect families across New York. Eating disorders - and many other mental illnesses--are highly treatable with affordable medical care that doesn't leave New Yorkers choosing between bankruptcy and recovery. I am proud to have championed crucial, life-saving legislation on this issue and am optimistic that the new regulations will go a long way to helping families afford the mental health care they need."
CEO of National Eating Disorders Association Claire Mysko said, "NEDA is thrilled that the New York State Department of Financial Services has proposed a regulation requiring insurers to implement a mental health and substance use disorder parity compliance program. Improved access to care for eating disorders and other mental health conditions is important now more than ever, as the challenges brought about by the COVID-19 pandemic have been particularly difficult for the mental health community, including those impacted by eating disorders. We are so grateful to Governor Andrew Cuomo, Assemblywoman Nily Rozic, and Superintendent Linda Lacewell for their support of the eating disorders and mental health communities, and for their leadership in ensuring this important access to care."
Under the proposed regulation, parity compliance programs must establish corporate governance for parity compliance, identify discrepancies in coverage of services for the treatment of mental health conditions and substance use disorder, and ensure appropriate identification and remediation of improper practices.
The proposed regulation requires insurers to designate an appropriately experienced individual who shall:
- Be responsible for assessing, monitoring, and managing parity compliance;
- Report directly to the insurer's chief executive officer or other senior manager; and
- Report no less than annually to the insurer's board of directors or other governing body, or the appropriate committee thereof, on the activities of the compliance program.
The compliance program must also include:
- Written policies and procedures that implement the compliance program, and describe how the insurer's parity compliance is assessed, monitored, and managed;
- Methodologies for the identification and remediation of improper practices;
- A process for the actuarial certification of the analyses of the financial requirements and quantitative treatment limitations;
- Training and education for employees and directors;
- The methods by which employees and directors may report parity compliance issues; and
- A policy of non-intimidation and non-retaliation for good faith participation in the compliance program.
Practices that are prohibited and must be remediated within 60 days of discovery include:
- A utilization review policy that uses different standards to determine the level of documentation for mental health or substance use disorder benefits versus medical or surgical benefits;
- Requiring preauthorization, concurrent, or retrospective utilization review for a higher percentage of mental health or substance use disorder benefits in the absence of defined clinical or quality triggers;
- Implementing a methodology for developing and applying provider reimbursement rates for mental health or substance use disorder benefits that is not comparable to or is applied more stringently than the methodology for developing and applying provider reimbursement rates for medical or surgical benefits; and
- Implementing claim edits or system configurations that provide for higher rates of approval through auto-adjudication for claims for inpatient medical or surgical benefits than for inpatient mental health or substance use disorder benefits.
A full copy of the proposed regulation can be found on the DFS website. Public comments will be accepted until September 7, 2020.