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Minimum benefit package: flexibility, but parity

January 10, 2012
by Alison Knopf
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HHS guidance appears to protect substance use and mental health coverage

While many uncertainties remain about the place of substance use disorder (SUD) and mental health (MH) benefits under the Affordable Care Act (ACA), there are two realities the behavioral health field now can rely on: 1) SUD/MH services constitute one of the 10 required components in the essential benefits package; and 2) the ACA requires that coverage comply with the federal parity law.

These guarantees were made clear in a Dec. 16, 2011 bulletin from the U.S. Department of Health and Human Services (HHS) that said each state will establish minimum benefits for all health insurance plans beginning in 2014. HHS is asking for comments by Jan. 31; a formal rulemaking will follow.

Key to the SUD/MH field is the HHS requirement that whatever insurance plan the state chooses to be the “benchmark” plan, it must be compliant with the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA).

Benchmark plan

According to the HHS bulletin, each state can select an existing health plan to serve as the benchmark. Whatever benefits are in that plan would become the minimum benefits package for that state. The plan must be one of the following:

  • One of the three largest small-group plans in the state;
  • One of the three largest state employee health plans;
  • One of the three largest federal employee health plan options; or
  • The largest HMO plan offered in the state’s commercial market.

The strength of the addiction treatment benefit depends on HHS implementing the parity requirements under the ACA, says Paul Samuels, director and president of the Legal Action Center and co-chair of the Coalition for Whole Health, which is spearheading the behavioral health field’s input regarding ACA implementation.

Samuels, who met with HHS officials just before the Dec. 16 guidance was released, is optimistic about the prospects for SUD/MH benefits. “My understanding from the briefing is that even as states select their benchmark plans, the coverage for SUD and MH services must be at parity,” Samuels says.

The fact that the minimum benefit package in each state must comply with the MHPAEA is “something we can hang our hat on,” says Mark Dunn, public policy consultant to the National Association of Addiction Treatment Providers (NAATP).
“It’s a huge step forward for us.”

HHS is considering allowing “modifications” and “substitutions” within each of the 10 benefit categories, and even across categories, as long as the actuarial value of the plan does not change. But the SUD/MH benefit would not be subject to this “actuarial adjustment” in the state benchmark plans because of the parity requirement, HHS officials said at a high-level briefing attended by Samuels before release of the guidance document. This further protects SUD/MH services.

The actuarial value of a plan is a calculation of how much the plan is worth. The richer the benefit and the lower the cost-sharing, the higher the value.

“It is key to us that parity be implemented so that when the smoke clears and states have established their plans, there is a set of services that meets people’s needs,” says Samuels.

Limitations of parity

The 10 benefit categories

Below are the 10 benefit categories defined in the essential benefits package for the ACA:

• Ambulatory patient services;
• Emergency services;
• Hospitalization;
• Maternity and newborn care;
• Mental health and substance use disorder services, including behavioral health treatment;
• Prescription drugs;
• Rehabilitative and habilitative services and devices;
• Laboratory services;
• Preventive and wellness services and chronic disease management; and
• Pediatric services, including oral and vision care.

However, the MHPAEA does not require plans to cover mental health and substance use disorders. It just says that if plans do cover them, coverage must be at parity. What if the state benchmarks to a plan that has no SUD or MH coverage?

In addition, it has become clear that parity still is not being universally enforced. What if a plan does have coverage but the coverage is insufficient and not at parity?

Samuels asked HHS officials these questions, and he says he received an encouraging response. “They told me that in either of those scenarios, the state will be required to add in sufficient coverage to meet the parity requirement,” he says. This additional coverage won’t be able to be traded for something else in another of the 10 categories (actuarial adjustment).

“They also said that there will be a requirement that all the categories that are included for medical/surgical must also be there for SUDs and MH,” Samuels says.

What percentage of actuarial value should coverage for MH/SUDs represent? “This is an important issue that we are looking at carefully,” says Samuels. “It’s important that states select benchmark plans that have robust coverage. It’s important not to minimize the importance of the overall benchmark plan being a good one.”

The Association for Behavioral Health and Wellness (ABHW), which represents managed behavioral health organizations, is reviewing the HHS bulletin and “evaluating its impact on mental health and substance use disorder benefits,” says association president Pamela Greenberg. “Since the states have been given the responsibility of choosing a benchmark benefit, it is difficult to know at this point what that benefit will and won't include,” says Greenberg.