Download Agencies issue new FAQs on the ACA,

Insights
from People and Organization
Agencies issue new FAQs on the ACA,
Mental Health Parity and Women’s
Health and Cancer Rights Act
April 28, 2016
In brief
The Departments of Labor, Treasury and Health and Human Services (the ‘Agencies’) issued a new set of
FAQs (Part 31) addressing provisions of the Affordable Care Act (ACA) , Mental Health Parity and
Addition Equity Act (MHPAEA) and Women’s Health and Cancer Rights Act (WHCRA). Although the
FAQs expand a number of coverage requirements, similar to other guidance, the Agencies do not provide
an effective date for their interpretations.
In detail
Affordable Care Act
guidance
Preventive Services
Under the ACA, nongrandfathered group health
plans and health insurance
issuers must cover certain
preventive services without cost
sharing, including
colonoscopies. In the FAQs, the
Agencies explain that in
addition to covering the
colonoscopy, any bowel
preparation medications also
must be covered without cost
sharing, subject to reasonable
medical management.
Observation
As with other preventive
services, some charges may be
medical and some may be for
prescription drugs. Plan
sponsors will need to
coordinate with their medical
and prescription drug vendors.
Contraceptive coverage also is
among the preventive services
that must be covered without
cost sharing. In previous FAQs,
the Agencies clarified that a plan
or issuer must cover at least one
contraception form in each of
the methods (currently 18) the
Food and Drug Administration
identified. Although a plan or
insurer may use reasonable
medical management
techniques within a specified
contraceptive method to control
costs, there must be an
exception process to cover
methods without cost sharing
that are recommended by the
health care provider (and
deference must be given to the
health care provider’s
recommendation). These FAQs
explain that a plan or issuer may
develop a standard exception
form that an attending provider
may use, and the Medicare Part
D Coverage Determination
Request Form may serve as a
model for this form.
Rescissions
Under the ACA, a plan or issuer
may not rescind (retroactively
terminate) coverage unless the
person commits fraud, makes
an intentional
misrepresentation of a material
fact or does not pay premiums.
The FAQs lay out a scenario
common to the educational
community. A school district
employed the individual for a 10
month teaching contract from
August 1 through May 31, but
health care coverage was for the
plan year from August 1 through
July 31.
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When the person resigned on July 31,
the district retroactively terminated
the health care coverage effective as of
May 31 (her last day of active
employment). The Agencies state that
this was an impermissible rescission.
internal claims and appeals and
external review requirements under
the ACA, which apply to nongrandfathered group health plans and
issuers, would require disclosing how
these amounts are calculated.
Observation
Clinical Trial Coverage
Generally, plans should not
retroactively terminate health care
coverage unless there is proof of
fraud or material misrepresentation
or non-payment of premiums, or in
the limited circumstance described in
a prior FAQ that allows rescission for
administrative reasons.
Although a nongrandfathered plan or
issuer is not required to cover an
investigational item that is part of a
clinical trial, the ACA requires plans
and issuers to cover routine patient
costs associated with the clinical trial,
which are costs that are covered under
the plan for individuals not in a
clinical trial. To date, the Agencies
have not issued any guidance on this
provision, and plans and issuers were
expected to use a good faith,
reasonable interpretation of the law to
implement this provision. In these
FAQs, the Agencies state that if a plan
typically covers routine patient costs
or items or services to diagnose or
treat complications or adverse events
(such as side effects), the plan or
issuer cannot deny coverage for any of
these items only because it is provided
in connection with participation in a
clinical trial. The Agencies pointed out
that the ACA does not require a plan
or issuer to provide coverage for outof-network routine patient costs
associated with a clinical trial, unless
otherwise covered under the plan.
Out-of-network emergency services
The ACA provides that
nongrandfathered plans and issuers
cannot impose cost sharing on out-ofnetwork emergency services greater
than the cost sharing for in-network
benefits. However, this provision does
not prohibit balance billing (where a
provider charges a patient for the
difference between what the plan or
insurer pays and the total cost).
Because balance billing could leave
patients with significant out-of-pocket
costs, the regulations require plans to
pay a reasonable amount before the
patient is responsible for a balance
billed amount. Plans are required to
pay at least the greatest of three
amounts specified in the regulations.
The FAQs provide that plans are
required to disclose how the minimum
payment amount is calculated,
including the method the plan uses to
determine payments for out-ofnetwork services (such as the usual,
customary, and reasonable (UCR)
amount). Plans covered by the
Employee Retirement Income
Security Act (ERISA) would be
required to disclose how the above
amounts are calculated within 30 days
of a participant’s request for such
information. In addition, both the
ERISA claims procedures and the
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Observation
Because there has not been any
guidance on covering routine patient
cost associated with a clinical trial,
plans and issuers should review
coverage to make sure they are in
compliance with this new guidance.
Limitations on Cost-Sharing
The ACA imposes cost sharing
limitations on non-grandfathered
plans and issuers. For example, the
maximum out-of-pocket (MOOP)
limits for 2016 are $6,850 (self-only)
and $13,700 (other than self-only
coverage). If a plan includes a network
of providers, a plan may, but is not
required to, count an individual’s outof-pocket spending for out-of-network
items and services toward the MOOP.
In previous guidance, the Agencies
discussed how reference based pricing
(paying a fixed amount for a specific
procedure) works with the MOOP
limits. In that guidance, the Agencies
were concerned about pricing
structures that only treat providers
who accept the reference pricing as innetwork providers and treat all others
as out-of-network, so the participant’s
out-of-pocket expenses for services
from these providers do not count
toward the MOOP limit. The previous
guidance requires plans and issuers to
ensure that there is adequate access to
providers at the reference-based price.
In these new FAQs, the Agencies state
that a plan or issuer that does not
ensure that there is adequate access to
providers who accept the referencebased price must count the person’s
out-of-pocket expenses for providers
who do not accept the reference-based
price toward the MOOP limit.
MHPAEA guidance
The MHPAEA requires that the
financial requirements and treatment
limitations imposed on mental health
and substance use disorder
(MH/SUD) benefits cannot be more
restrictive than the predominant
financial and treatment limitations
that apply to substantially all medical
and surgical benefits. The MHPAEA
regulations provide a detailed,
numeric formula for determining the
‘predominant’ limitations for medical
and surgical benefits. The regulations
allow any reasonable method to be
used to make this determination.
The FAQs clarify that basing this
determination on an issuer’s entire
book of business in a state or region is
not a reasonable method. To the
extent specific group health plan data
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is available, each self-insured group
health plan must use that data. In the
insured market, if premiums are
determined on an experience rated
basis, the issuer should have the
information to make that MHPAEA
determination. If that information is
not available, data from other
similarly structured group health
plans should be used.
In previous guidance, the Agencies
addressed the MHPAEA disclosure
requirements, such as the criteria for
medical necessity determinations. In
these FAQs, the Agencies list a
number of documents that would be
helpful to a provider who is acting as a
plan participant’s ERISA authorized
representative to request regarding
the plan’s compliance with MHPAEA
with respect to a pre-authorization
request for a patient’s visits for
depression. The Agencies list the
following documents:
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
nonquantitative treatment
limitations (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,
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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.
Observation
restrictive financial or treatment
limitations on MAT than the
predominant financial or
quantitative limits for medical,
surgical and pharmacy benefits. Note
that the multi-tiered prescription
drug benefit rules apply to the
prescription portion, and the
behavioral health component should
be treated as either in- or out-patient
benefits, as appropriate. In addition,
depending on the MHPAEA analysis,
MAT may have to be offered both inand out-of-network.
After the release of this FAQ, plans
may receive more document requests
from providers who are acting on
behalf of patients where either the
benefits have been denied or the plan
is requesting additional information.
Plans should review their plan
documents, SPDs and other
information to make sure that all are
up to date not only with respect to
MHPAEA benefits, but with all ERISA
requirements. For entities subject to
ERISA, failure to provide the above
documents within 30 days of the date
of request could subject the plan
administrator to a possible $110 per
day penalty.
WHCRA guidance
In the FAQs the Agencies also stated
that medical necessity criteria for
coverage of a mental health condition
from an issuer or group health plan
must be made available to any current
or potential enrollee or contracting
provider upon request.
The Takeaway
The FAQs clarified that the MHPAEA
applies to Medication Assisted
Treatment (MAT), which is any
treatment for opioid use disorder that
includes medication that is FDAapproved for detoxification or
maintenance treatment in
combination with behavioral health
services.
Under the WHCRA, if a plan provides
coverage for mastectomies, it also
must provide coverage for breast
reconstruction surgery, in a manner
determined in consultation with the
attending physician and the patient.
The FAQs clarify that this includes
coverage for nipple and areola
reconstruction, including nipple and
areola repigmentation to restore the
physical appearance. Under WHCRA,
plans and issuers may impose
deductibles and coinsurance on these
benefits if this cost-sharing is
consistent with other cost sharing
under the plan.
These FAQs add significantly to the
health coverage and related disclosure
requirements under various laws. Plan
sponsors and issuers should review
their plans and documentation to
make sure that the coverage
requirements are met, documentation
is up to date and disclosure
procedures will comply with these
new rules.
PwC can help plan sponsors and
issuers come up with an action plan to
ensure compliance.
Observation
This interpretation means that plans
and issuers may not place more
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Let’s talk
For more information, please contact our authors:
Amy Bergner, Washington, DC
(202) 312-7598
[email protected]
Anne Waidmann, Washington, DC
(202) 414-1858
[email protected]
Chantel Sheaks, Washington, DC
(202) 375-3138
[email protected]
or your regional People and Organization professional:
US Practice Leader
Scott Olsen, New York
(646) 471-0651
[email protected]
Charlie Yovino, Atlanta
(678) 419-1330
[email protected]
Craig O'Donnell, Boston
(617) 530-5400
[email protected]
Jack Abraham, Chicago
(312) 298-2164
[email protected]
Brandon Yerre, Dallas
(214) 999-1406
[email protected]
Todd Hoffman, Houston
(713) 356-8440
[email protected]
Carrie Duarte, Los Angeles
(213) 356-6396
[email protected]
Ed Donovan, New York Metro
(646) 471-8855
[email protected]
Bruce Clouser, Philadelphia
(267) 330-3194
[email protected]
Jim Dell, San Francisco
(415) 498-6090
[email protected]
Scott Pollak, San Jose
(408) 817-7446
[email protected]
Nik Shah, Washington Metro
(703) 918-1208
[email protected]
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