Mental Health Parity Act: Your Right to Equal Coverage

What Is the Mental Health Parity Act?

The Mental Health Parity and Addiction Equity Act (MHPAEA) is a federal law that prohibits health insurers from treating mental health and substance use disorder (MH/SUD) benefits less favorably than medical/surgical benefits. If your plan covers mental health at all, it must cover it on equal terms with physical health care.

Key Requirements Under MHPAEA

• Financial requirements must be equal: Copays, deductibles, and coinsurance for mental health cannot be higher than for medical/surgical care
• Treatment limitations must be equal: Visit limits, prior authorization requirements, and other restrictions must be no more restrictive than for physical health
• Non-quantitative limits must be comparable: Medical necessity criteria, network standards, and fail-first requirements must be applied equally
• Out-of-network benefits: If the plan offers out-of-network coverage for medical care, it must offer comparable coverage for mental health

Who Does MHPAEA Apply To?

MHPAEA applies to most employer-sponsored health plans and health insurance coverage offered by issuers in the individual and group markets. However, there are some exceptions:

• Covered: Large employer plans (50+ employees), individual market plans under ACA, state and local government plans
• Covered with variations: Small employer plans (state law may provide additional protections)
• Exempt: Medicare, Medicaid fee-for-service, TRICARE (covered under separate rules), retiree-only plans

Common Mental Health Parity Violations

Despite MHPAEA's requirements, insurers frequently violate parity in ways that may not be immediately obvious. Here are the most common violations I see:

1. Stricter Prior Authorization for Mental Health

If your insurer requires prior authorization for outpatient mental health visits but not for outpatient medical visits, this is likely a parity violation. The same applies if mental health authorizations must be renewed more frequently than medical ones.

2. More Restrictive Medical Necessity Criteria

Insurers often apply stricter "medical necessity" standards to mental health care. For example, requiring that a patient be "in crisis" to qualify for inpatient psychiatric care, while inpatient medical care only requires that it be "appropriate and effective."

3. Narrow Mental Health Provider Networks

If your plan maintains a robust network of medical specialists but has very few in-network mental health providers, this may violate parity's non-quantitative treatment limitation (NQTL) requirements. Network adequacy standards must be applied equally.

4. Fail-First (Step Therapy) Requirements

Requiring patients to try and fail cheaper mental health treatments before covering more intensive care - when similar requirements don't exist for medical conditions - violates parity. This is especially common for residential treatment and intensive outpatient programs.

How to Fight a Parity Violation

If you believe your insurer is violating MHPAEA, you have several options. The key is to document everything and be persistent.

Step 1: Request a Written Explanation

Under MHPAEA and its implementing regulations, you have the right to request the specific criteria used to deny your claim. The insurer must provide:

• The specific reason for the denial
• The medical necessity criteria applied
• How those criteria compare to what's used for medical/surgical benefits
• The clinical rationale for the decision

Step 2: File an Internal Appeal

Before taking external action, you typically must exhaust your plan's internal appeal process. In your appeal:

• Cite MHPAEA specifically and explain how you believe parity is being violated
• Ask the insurer to compare the treatment limitation to what's applied for medical/surgical care
• Include supporting documentation from your treating provider
• Request an expedited appeal if delaying treatment would harm your health

Step 3: File an External Review

If your internal appeal is denied, you can request an Independent External Review. For fully-insured plans, this is typically handled by your state's insurance department. For self-funded ERISA plans, a federal external review process applies.

Step 4: File Regulatory Complaints

You can file complaints with multiple agencies:

• Department of Labor (DOL): For employer-sponsored ERISA plans - askebsa.dol.gov
• State Insurance Department: For fully-insured plans regulated by your state
• Centers for Medicare & Medicaid Services (CMS): For individual and small group market plans

Common Mental Health Coverage Disputes

Residential Treatment Programs

Insurers frequently deny or limit residential mental health and substance abuse treatment, claiming it's not "medically necessary." Under parity, the medical necessity criteria for residential psychiatric treatment cannot be more restrictive than for skilled nursing facilities or inpatient rehabilitation for physical conditions.

Eating Disorder Treatment

Eating disorders like anorexia nervosa, bulimia, and binge eating disorder are serious mental health conditions that often require intensive treatment. Insurers cannot impose visit limits or duration restrictions that don't equally apply to comparable medical conditions.

Autism Spectrum Disorder Services

Applied Behavior Analysis (ABA) therapy and other autism treatments are frequently subject to inappropriate limitations. While autism coverage varies by state, MHPAEA still requires that any mental health benefits offered be on par with medical benefits.

Substance Use Disorder Treatment

Medication-Assisted Treatment (MAT), detox programs, and substance abuse counseling must be covered on par with medical care. Prior authorization requirements and treatment duration limits cannot be more restrictive than for analogous medical conditions.

Building Your Parity Case

To successfully challenge a parity violation, you need to document the disparity between how your insurer treats mental health versus medical/surgical benefits.

What to Document

• All denial letters: Save every written denial, including the stated reasons
• Phone call records: Note dates, times, representative names, and what was said
• Plan documents: Request your Summary Plan Description (SPD), Evidence of Coverage (EOC), and any mental health benefit riders
• Comparative information: If possible, document how similar requests for medical care are handled
• Provider documentation: Get your treating provider's notes explaining why the treatment is medically necessary

Request the Comparative Analysis

Since 2021, you can request your insurer's MHPAEA comparative analysis documents. These must show:

• The specific plan terms being compared
• The factors used to apply limitations to MH/SUD benefits
• Evidence that those factors are applied comparably to medical/surgical benefits
• The findings and conclusions of the analysis