In a report to Congress in April, the Department of Labor (DOL) illustrated the current status of parity implementation. Out of 671 health plan investigations, 378 included reviews of parity compliance, resulting in 136 citations.
As many behavioral health executives know first-hand, suspected parity violations by insurers are not uncommon, and remedies aren’t particularly straightforward.
“We’ve been working on parity for decades, even before the Affordable Care Act and before the opioid crisis,” says Andrew Kessler, JD, founder and principal of Slingshot Solutions. “It’s clear to a lot of us that parity is going to be played out in the courts.”
The DOL’s Employee Benefits Security Administration (EBSA) has investigators working in 10 regional offices and notes that parity is a national initiative this year. Under current law, EBSA may document parity violations and seek voluntary resolution with insurers, but it doesn’t have the authority to issue penalties for noncompliance.
Generally, the offending organization would be expected to provide reimbursement and coverage for health plan members whose claims were improperly denied. In some cases, the insurer would be expected to make universal policy changes to fix the parity issue.
“One day, a court will rule on what must be done—or not done—and then it will become clear,” Kessler says. “The strongest tool we have right now is the courts.”
He says the lack of penalties and the language of parity provisions allow enough wiggle room for insurers to be somewhat unsteady in their implementation.
Many of today’s violations fall into the category of nonquantitative treatment limits, such as fail-first policies or prior authorization requirements. For example, in 2017, EBSA found just 9% of the violations it documented included improper annual limits on coverage—clear defiance of parity laws. By comparison, 49% of violations included nonquantitative limits, which are more difficult for investigators, lawmakers and patients to identify for correction.
Even so, when parity issues are called out, the only recourse is for EBSA to ask for voluntary correction or for a patient to sue the insurer. The White House’s own commission on the opioid crisis recommended that DOL be granted increased authority to levy financial penalties on insurers that violate parity laws. According to Kessler, there has been no action on the recommendation.
DOL Secretary Alexander Acosta has testified that he would like to see support for the department gaining such authority.
Parity protects patients
Kessler also says it’s important to remember that parity laws are meant to protect patients—not providers. On-par reimbursement for providers of mental health and addiction treatment services is a separate issue.
“I’ll be the first to say that providers don’t get paid enough,” he says. “There is a bill being considered in the Senate right now with language recommending the Centers for Medicare and Medicaid Services do a review of reimbursement rates.”
However, he believes down the road, parity issues and reimbursement issues will reinforce each other. High demand for services—thanks to parity—will equate with a need to incentivize providers with reasonable reimbursement to meet the needs of communities.
“Parity is about the dollar amounts a consumer has at their disposal via a health coverage policy,” he says. “As much as I would like to see it come up—and it will—reimbursement is not a parity issue.”
Kessler is presenting at the National Conference on Alcohol & Addiction Disorders, August 19-22, 2018, at Disneyland in California.