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State introduces regs on insurance for mental health and substance-use disorders
The Business Journal - 11/26/2020
Final regulations that will go into effect on Dec. 29 require insurers to put into place policies and procedures that will ensure that they are providing comparable coverage for mental health and substance-use disorders.
The New York State Department of Financial Services (DPS) and New York State Department of Health proposed the parity compliance-program regulations. They were adopted following a 60-day period for public comments, the office of Gov. Andrew Cuomo said in a news release.
The regulations will "strengthen" insurers' obligation under both state and federal law to provide comparable coverage for benefits to treat mental health and substance-use disorders, the state contends.
"This regulation provides important protections so that New Yorkers receive the coverage and benefits they need. It is particularly critical now as more people experience increased stress from the three simultaneous crises in public health, the economy, and civil rights," Linda Lacewell, New York State Superintendent of Financial Services, said in a statement. "DFS is proud to stand with Gov. Cuomo in supporting New Yorkers with a mental-health condition or substance-use disorder by requiring that insurers have robust programs in place to meet their statutory mental health and substance-use disorder parity compliance obligations."
Designating experienced person
The regulations require insurers to designate an "appropriately experienced" individual who will be responsible for assessing, monitoring, and managing parity compliance. That person shall also report directly to the insurer's CEO or other senior manager.
In addition, the individual will report at least once a year to the insurer's board of directors or other governing body, or an appropriate committee, on the activities of the compliance program.
The compliance program must also include written policies and procedures that implement the compliance program, and describe how the insurer's parity compliance is assessed, monitored, and managed.
It must also include methodologies for the identification and remediation of improper practices, along with a process for the actuarial certification of the analyses of the financial requirements and quantitative treatment limitations.
In addition, the compliance program must also include training and education for employees and directors; the methods by which employees and directors may report parity compliance issues; and a policy of non-intimidation and non-retaliation for good-faith participation in the compliance program.
The regulations also outline practices that are prohibited and must be remediated within 60 days of discovery.
They include a utilization-review policy that uses standards to determine the level of documentation required for mental health or substance-use disorder benefits that are not comparable to or are "more stringently applied" than the standards used for medical or surgical benefits.
The practices also include requiring preauthorization, concurrent, or retrospective utilization review for a higher percentage of mental health or substance-use disorder benefits in the "absence of defined clinical or quality triggers."
They also include implementing a methodology for developing and applying provider reimbursement rates for mental health or substance-use disorder benefits that is not comparable to or is more stringently applied than the methodology for developing and applying provider reimbursement rates for medical or surgical benefits.
In addition, they include implementing claim edits or system configurations that provide for higher rates of approval through auto-adjudication of claims for inpatient medical or surgical benefits than for inpatient mental health or substance-use disorder benefits, per the state's release.