Parity Update California Parity Field Hearing July 1, 2013

Background 2008 –The Mental Health Parity & Addiction Equity Act (MHPAEA) becomes law; fully effective 1/1/ –The Affordable Care Act (ACA) becomes law 2

What is Parity & Why it Matters State of being equal; especially regarding status or pay Historic discrimination in access to care Higher out-of-pocket spending Life expectancy < 30 years Final regs implementing MHPAEA lagging 3

IFR Requires 6 Classes of Benefits Parity regulations set up 6 classes of benefits: ▫Inpatient in & out-of-network ▫Outpatient in & out-of-network ▫Emergency care ▫Prescription drugs Parity Implementation Coalition supports adding: ▫Intermediate inpatient in & out-of-network ▫Intermediate intensive outpatient in & out-of- network 4

3 Key Parity Issues Must be Resolved Transparency & disclosure of medical criteria & plan terms ▫Without disclosure, no compliance testing is possible Non-quantitative treatment limits ▫Need quantitative floor (i.e. 50%) to operationalize parity in medical management Scope of service ▫Plans are excluding essential levels of MH/SUD care; including MAT 5

Affordable Care Act & Parity In 2014, ACA expands MHPAEA & will apply to: ▫Benefits provided in new “exchanges” ▫Benefits provided by non- grandfathered small group & individual plans ▫Benefits provided to new Medicaid population ▫These plans will have to offer a MH/SUD benefit 6

Lawsuits Alleging MHPAEA Violations C.M. vs. Fletcher Allen Health Care ▫U.S. District Court of VT found plans, rather than patients, have the burden of proof to provide clinically appropriate standards of care to justify treating MH/SUD claims differently than medical APA & CT Psychiatric Society filed suit against Anthem in CT ▫Anthem agreed to use proper CPT codes but other parity issues still pending Class action suit filed in NY by NY State Psychiatric Association against UnitedHealth ▫Key issue: More stringent medical management (NQTL violation) More lawsuits to come 7

Resources Parity Implementation Coalition ▫ States & public plans  CMS Center for Consumer Insurance Information & Oversight (CCIIO)  ext  Employer plans  DOL Employee Benefits Administration   CA Insurance Commissioner Consumer Assistance Office ▫ HELP ( TDD) ▫ 8