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On April 6. 2015, the U.S. Centers for Medicare & Medicaid Services (CMS) announced a proposed rule to align mental health and substance use disorder benefits for low-income Americans with benefits required of private health plans and insurance. The proposed rule applies certain provisions of the Mental Health Parity and Addiction Equity Act of 2008, which ensures that mental health and substance use disorder benefits are no more restrictive than medical and surgical services, to Medicaid and the Children's Health Insurance Program (CHIP).

The proposed rule ensures that all beneficiaries who receive services through managed care organizations or under alternative benefit plans have access to mental health and substance use disorder benefits regardless of whether services are provided through the managed care organization or another service delivery system. The full scope of the proposed rule applies to CHIP, regardless of whether care is provided through fee-for-service or managed care.

Currently, states have flexibility to provide services through a managed care delivery mechanism using entities other than Medicaid managed care organizations, such as prepaid inpatient health plans or prepaid ambulatory health plans. The proposed rule would continue this States flexibility in identifying varying delivery systems for Medicaid services provided to beneficiaries, while ensuring that enrollees of a Medicaid managed care organization receive the benefit of parity in services provided to them through these various means. States will be required to include contract provisions requiring compliance with parity requirements in all applicable contracts for these Medicaid managed care arrangements.

Under the proposed rule, plans must 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 proposed rule also would require the state 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.

View the proposed rule which will be published in the Federal Register on April 10, 2015.  The deadline to submit comments is June 9, 2015.

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