The Department of Labor's Employee Benefits Security Administration (EBSA) released compliance guidance in the form of one Frequently Asked Question (FAQ) regarding compliance with the "substantially all" test required by the interim final regulations issued by EBSA on February 2, 2010, and which is effective for plan years beginning on or after July 1, 2010.
The FAQ was released in response to comments to EBSA regarding how to comply with the mental health parity requirements when a plan uses both copayments and coinsurance for various outpatient services.
In general, the interim final regulations prohibit a plan from applying any financial requirement or treatment limitation to mental health or substance use disorder (MH/SUD) benefits in any classification that is more restrictive than the predominant financial requirement or treatment limitation applied to "substantially all" medical/surgical benefits in the same classification. If a type of financial requirement or quantitative treatment limitation does not apply to at least two-thirds of all medical/surgical benefits in a classification, then that type of limitation cannot be applied to MH/SUD benefits in that classification.
In the FAQ, until final regulations are issued, EBSA established an enforcement safe harbor that allows a plan to establish sub-classifications within the outpatient benefit classification. The only sub-classifications allowed are: 1) office visits; and 2) all other outpatient items and services.
The safe harbor addresses the situation faced by many employers that fail to meet the "substantially all" test required under the interim final regulations. Many employers conducted the test only to discover that neither the coinsurance nor copay apply to substantially all (66-2/3%) of their medical/surgical plan costs, thereby prohibiting the plan from applying any financial requirements.
By allowing these sub-classifications, we expect most employers will be able to pass the substantially all test and apply either coinsurance or copay to their outpatient MH/SUD benefit. However, it is important to note that if some types of office visits are covered by coinsurance and others by a copay, the substantially all test may still need to be conducted.
In general, the following services would be categorized within each outpatient sub-classification:
