How Do Mental Health Parity Laws Impact “Usual, Customary and Reasonable”

How Do Mental Health Parity Laws Impact “Usual, Customary and Reasonable”

Usual, Customary and Reasonable Benefit Adjustments are often ambiguously applied to out-of-network claims and providers are left with little understanding of if the benefit calculation is accurate or not.

While these balances are often the patient’s responsibility, many healthcare providers take on the advocacy role by seeking clarification regarding the UCR calculation, appealing excessively large discounts and seeking input on what pricing database was used to calculate the benefit.

These efforts to obtain benefit calculation information can be maddening. While a basic consumer protection related to insurance is a written, easily understood policy, nothing about out-of-network benefit calculation ever seems guided by simplicity. However, the Mental Health Parity and Addiction Equity Act (MHPAEA) outlines strict protections related to any plan offering mental health benefits.

MHPAEA defines six classifications of benefits that each require parity compliance: inpatient in-network, inpatient out-of-network, outpatient in-network, outpatient out-of-network, emergency care, and prescription drugs. If coverage for mental health and substance use disorders is provided in one classification, it must be provided in each of the six benefit classifications where medical/surgical coverage is provided. The law impacts both “quantitative” benefit decisions such as how much deductible applied to a claim and “non-quantitative” benefit (NQTL) decision such as network adequacy.

In a lengthy article explaining the impact of the MHPAEA on claims, Milliman advises making sure the usual, customary and reasonable calculations are compliant with the act. Milliman raises the following questions in regards to assessing compliance:

Can health plans and employers continue to use networks that are based on negotiated contracted rates that pay medical/surgical providers differently than behavioral providers? It would seem that normal business practices allow for negotiation on network rates separately for different types of providers. Signed provider contracts are an agreement between both parties as to specific payment rates in return for network participation. But if this leads to network access differences between medical/surgical providers and behavioral providers, could this be a non-quantitative treatment limitation? For out-of-network providers, it would seem clear that usual and customary rates paid to behavioral providers need to be comparable to those paid to substantially all medical/surgical providers.

Cite: http://us.milliman.com/uploadedFiles/insight/healthreform/implementing-parity-investing-behavioral.pdf

Further, MHPAEA requires certain insurers to provide sufficient disclosure of the information used to reach any adverse benefit determination. The Department of Labor provides some guidance regarding MHPAEA compliance and outlines some extensive disclosure requirements. For example, a Frequently Asked Questions section from a mental health provider regarding preauthorization issues outlines extensive documents subject to disclosure related to this everyday provider to insurer request:

Question: I am a provider acting as an authorized representative for an ERISA group health plan participant. The health plan has requested that I complete a pre-authorization form after the patient’s 9th visit for the treatment of depression. I understand that there are a number of documents that plans must provide upon request. Which of those documents would generally be most helpful for me to request regarding the plan’s compliance with MHPAEA?

Answer: You may request the following documents and plan information, which could be helpful in evaluating the plan’s compliance with MHPAEA. While it may not be necessary to review all of the following documents and plan information, the plan must provide any of these documents and plan information to you if requested, when you as a provider are acting as an individual’s authorized representative:

1. A Summary Plan Description (SPD) from an ERISA plan, or similar summary information that may be provided by non-ERISA plans;
2. The specific plan language regarding the imposition of the NQTL (such as a preauthorization requirement);
3. The specific underlying processes, strategies, evidentiary standards, and other factors (including, but not limited to, all evidence) considered by the plan (including factors that were relied upon and were rejected) in determining that the NQTL will apply to this particular MH/SUD benefit;
4. Information regarding the application of the NQTL to any medical/surgical benefits within the benefit classification at issue;
5. The specific underlying processes, strategies, evidentiary standards, and other factors (including, but not limited to, all evidence) considered by the plan (including factors that were relied upon and were rejected) in determining the extent to which the NQTL will apply to any medical/surgical benefits within the benefit classification at issue; and
6. Any analyses performed by the plan as to how the NQTL complies with MHPAEA.

How many providers ask and actually receive this type of extensive documentation regarding the preauthorization requirements? Based on feedback from our AppealLettersOnline.com subscribers, many seek this kind of in-depth information but very few get any kind of comprehensive response as seems suggested by this laundry list of things to ask for. However, if pressed to the higher levels of appeal, compliance with disclosure requests can be very important.

Providers who wish to seek MHPAEA compliance review of a UCR discount can use this Department of Labor FAQ as the starting point for crafting a similar documentation request to be used to seek information related to UCR calculations for out-of-network mental health services. When making such a request, be sure to provide proof that you are the authorized representative. This type of request can be sent in as part of an appeal or as a general request for benefit disclosure. Further, you may want to send this type of request to a general inquiries and/or appeals address but copy the compliance officer for the carrier and/or third party administrator.

I request the following documents in order to assess your organization’s compliance with the Mental Health Parity and Addiction Equity Act. This Act requires that certain plans cover mental health services – including inpatient in-network, inpatient out-of-network, outpatient in-network, outpatient out-of-network, emergency care, and prescription drugs – on a parity basis with medical/surgical services. Please provide the following:

1. A Summary Plan Description (SPD) from an ERISA plan, or similar summary information that may be provided by non-ERISA plans;
2. The specific plan language regarding the imposition of the NQTL (such as a how usual, customary and reasonable calculations are made);
3. The specific underlying processes, strategies, evidentiary standards, and other factors (including, but not limited to, all evidence) considered by the plan (including factors that were relied upon and were rejected) in determining that the NQTL will apply to this particular MH/SUD benefit;
4. Information regarding the application of the NQTL to any medical/surgical benefits within the benefit classification at issue;
5. The specific underlying processes, strategies, evidentiary standards, and other factors (including, but not limited to, all evidence) considered by the plan (including factors that were relied upon and were rejected) in determining the extent to which the NQTL will apply to any medical/surgical benefits within the benefit classification at issue; and
6. Any analyses performed by the plan as to how the NQTL complies with MHPAEA.