Treatment Advocacy Center on Parity & Medicaid

Mental Health Parity & Medicaid
​http://www.treatmentadvocacycenter.org/fixing-the-system/21st-century-cures-act


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So the Point Is Under CMS Parity Guidance We're Getting To A "Medical Necessity" Evaluation for ACT -- NOT THE $ Ran Out

See Page 36 of CMS Parity Compliance Toolkit.


So currently people with serious mental illness in Colorado do NOT have access to Assertive Community Treatment solely based on "medical necessity."

Even though this is such a critical, critical service-- ACT is financially limited based on savings from the Medicaid Managed Care Program -- well, that is NOT how we fund most critical medical services.

We don't think anyone is arguing that there shouldn't be normal limits to access to ACT.  BUT the current limits are just obscene -- they certainly implicate both Olmstead and Parity.  

6.4 An NQTL  [Non-Quantitative Treatment Limitations] Analysis Is Conducted Across Services Within a Classification, Not on a Service-to-Service Basis 

The NQTL analysis is conducted for each type of NQTL that applies to MH/SUD benefits in a classification; not on a service-to-service basis.

Parity does not require coverage of a similar M/S service in a classification for states to cover a MH/SUD service or to apply NQTLs to a unique MH/SUD service. Instead, each type of NQTL is tested only once in a classification, regardless of the type or number of services it limits.

It is important, however, to identify and evaluate any differences in the processes, strategies, evidentiary standards, or other factors used in applying the type of NQTL to each service as part of the analysis. 

Example: Assertive Community Treatment (ACT) is an intensive mental health service, often delivered outside of an office or hospital setting, designed to promote a consumer’s independence, rehabilitation, and recovery, while preventing unnecessary hospitalization.

State X has assigned ACT to the outpatient classification. No similar outpatient M/S benefit is covered. But this does not preclude state X from covering ACT, nor does it prevent state X from applying an NQTL to ACT if that NQTL is consistent with parity standards. 

State X assigned a prior authorization requirement to ACT because the services are costly and certain patient qualifying criteria must be met for safe and effective implementation as required by applicable national practice guidelines.

Similarly, state X assigned prior authorization requirements to several outpatient surgeries because they are costly and require specific patient qualifying criteria to be met for safe and effective implementation. 

MCO J administers state X’s M/S Medicaid benefits and PIHP K administers state X’s MH/SUD benefits. MCO J’s written policy and procedures require telephonic prior authorization for the specified outpatient surgeries.

During the prior authorization process, a nurse confirms eligibility and evaluates medical necessity and appropriateness of the proposed service. If a nurse is unable to authorize the surgery, a physician conducts the medical necessity review. Failure to obtain prior authorization results in no coverage. 

PIHP K’s written policy and procedures also require telephonic prior authorization for ACT services to evaluate medical necessity. During the prior authorization process, a trained customer service representative (CSR) confirms eligibility and authorizes ACT.

Weekly supervision and semiannual interrater reliability testing is conducted to evaluate CSR authorization decisions. If the CSR is unable to authorize ACT, a psychiatrist conducts the medical necessity and appropriateness review. Failure to obtain prior authorization results in no coverage. 

The prior authorization requirements for ACT are likely permissible under the parity standards of the final rule because the processes, strategies, evidentiary standards, and other factors are comparable and applied no more stringently to ACT than they are to the outpatient surgeries.

Although the qualifications for the person who conducts the initial screening for ACT are different from those for the outpatient surgeries, they are still comparable (e.g., criteria application training, supervision, and interrater reliability testing are comparable to nurse qualifications to make authorization decisions), and the difference in processes does not result in a more stringent application of the NQTL (i.e., for both M/S and MH/SUD benefits, the decision not to authorize is reviewed by a physician). 

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​The Need to Make Changes in Medicaid Rate Setting to Comply with Parity:  CMS Has Already Anticipated It

In this final rule, CMS applies certain provisions of the MHPAEA to requirements for Medicaid managed care organizations, Medicaid alternative benefit plans, and the Children’s Health Insurance Program (CHIP).

The rule is designed to align as much as possible with the approach taken in the final MHPAEA regulation to create consistency between the commercial and Medicaid markets.

​This helps to prevent inequity between beneficiaries who have mental health or substance use disorder conditions in the commercial market (including the state and federal Marketplace) and Medicaid and CHIP, and helps to promote greater consistency for these beneficiaries.

The final rule requires that all beneficiaries who receive services through managed care organizations, alternative benefit plans, or CHIP be provided access to mental health and substance use disorder benefits that comply with parity standards, regardless of whether these services are provided through the managed care organization or another service delivery system.

States are required to include contract provisions requiring compliance with parity standards in all applicable contracts for these Medicaid managed care arrangements that provide services to enrollees in managed care organizations, including prepaid inpatient health plans or prepaid ambulatory health plans.

In contrast to the proposed rule, this final rule also extends parity protections to apply to long term care services for mental health and substance use disorders in the same manner that they are applied to other services.

Key Provisions for Medicaid Managed Care Organizations Under the final rule, states that have contracts with managed care organizations are required to meet the parity requirements regarding financial and treatment limitations consistent with the regulation applicable to private insurers.

States will include the cost of providing additional services or removing treatment limitations in their capitation rate methodology for affected managed care plans.

By allowing changes to the managed care rate setting process, the rule also provides each state with flexibility to enable Medicaid managed care organizations to fully comply with the rule by including additional costs necessary to include extra services or remove treatment limits without changing the state’s non-alternative benefit plans and state plan.

​ In addition, the final rule requires managed care entities to make available upon request to beneficiaries and contracting providers the criteria for medical necessity determinations with respect to mental health and substance use disorder benefits.

The rule also directs managed care plans to make available to the enrollee the reason for any denial of reimbursement or payment for services with respect to mental health and substance use disorder benefits.