Proposed CMS Rule to Expand Parity to Medicaid, CHIP Enrollees

The Centers for Medicare and Medicaid Services (CMS) proposed a rule last month to apply requirements of the Mental Health Parity and Addiction Equity Act of 2008 to Medicaid managed care plans and the Children’s Health Insurance Program (CHIP).

The proposal would ensure that low-income patients have the legal right to receive mental health and substance use disorder coverage equal to the coverage they receive for other medical conditions. The 2008 law originally applied only to private commercial insurers and was amended under the Affordable Care Act to also apply to individual health insurance coverage.

The proposed rule does not apply to Medicaid fee-for-service plans; however, it does encourage states that run such plans to adopt mental health parity rules. The full scope of the proposed rule applies to CHIP, regardless of whether care is provided through fee-for-service or managed care, according to CMS.

“Whether private insurance, Medicaid, or CHIP, all Americans deserve access to quality mental health services and substance use disorder services,” said Vikki Wachino, acting director of the Center for Medicaid and CHIP Services, in a press release issued by CMS. “Improving quality and access to care impacts the health of our nation,” said Wachino.

The proposal will support the goals laid out in the Affordable Care Act and allow federal and state governments to promote access to mental health and substance use services as part of broader delivery system reform, Wachino added.

Medicaid and CHIP are funded by states and the federal government. States have the flexibility to provide services through various managed care delivery systems using managed care organizations, such as prepaid inpatient health plans or prepaid ambulatory health plans. The proposed rule would continue to give states flexibility in identifying varying delivery systems for Medicaid services and would ensure that patients covered by any Medicaid managed care organization receive the benefits that fall under the requirements of the parity law.

Under the proposed rule, transparency would be required. States would have to explain to patients the reason for any denial of reimbursement or payment for services relating to mental health or substance use disorder benefits. Moreover, they would be required to publically post the documentation related to parity compliance.

“The proposed rule, by expanding mental health parity, has the potential to greatly improve access to care for mental health and substance use disorders and the equity that our patients need,” APA President Paul Summergrad, M.D., said.

Summergrad noted that APA is particularly pleased to see the transparency provisions in the rule requiring states to publicly share their compliance with the proposed parity regulations. “This will help hold states and the payors they use accountable and will allow monitoring of the progress and implementation of parity,” he said.

“We’ve made much progress in recent years under the mental health parity act and the expansion of its applicability under the Affordable Care Act, and this rule will continue that progress by providing greater opportunity for Medicaid beneficiaries to receive the psychiatric and substance use services they need and deserve,” Summergrad said.

APA is reviewing the proposed rule in detail and will submit comments before the deadline on June 9. ■