Brown & Brown, Inc. · NYSE:BRO
Brown & Brown — Conference Presentation (January 2025)
58 slides from Brown & Brown's conference presentation, January 2025
Slide 1: This Webinar Will Start Momentarily
This Webinar Will Start Momentarily. Thank you for joining us.
Slide 2: Mental Health Parity and Addiction Equity Act (MHPAEA)
Mental Health Parity and Addiction Equity Act (MHPAEA) January 2025 Presented By: Christopher Bao and Brittany Botterill
Slide 3: Disclaimer
DISCLAIMER Brown & Brown, Inc. and all its affiliates, do not provide legal, regulatory or tax guidance, or advice. If legal advice counsel or representation is needed, the services of a legal professional should be sought. The information in this document is intended to provide a general overview o
Slide 4: MHPAEA: Timeline
MHPAEA: Timeline
Slide 5: MHPAEA Timeline
MHPAEA Timeline Date Law Content MHPAEA becomes law and is intended to create parity (i.e., equality) between mental October 3, 2028 Emergency Economic Stabilization Act of 2008 health and substance use disorder (MH/SUD) benefits and medical/surgical benefits (M/S). These rules were issued to implem
Slide 6: The Rule
MHPAEA: The Rule
Slide 7: General Parity Requirements
General Parity Requirements “ “A group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) that provides both medical/surgical benefits and mental health or substance use disorder benefits may not apply any financial requirement or treatment limitat
Slide 8: General Requirements
MHPAEA: General Requirements
Slide 9: To Whom Does it Apply?
MHPAEA: To Whom Does it Apply? W H O M U S T C O M P LY ? Group Health Plans Insurance Carriers • Fully insured and self-insured Health insurance issuers (therefore, even • Grandfathered and Non-Grandfathered small group fully insured plans could be • Both ERISA/Non-ERISA Health plans subject to MHP
Slide 10: Exceptions
MHPAEA: Exceptions C O V E R A G E T H AT M AY N O T B E S U B J E C T T O M H P A E A Certain coverages may not be subject to the MHPAEA Non-Federal Governmental Plan Opt-Out: 1) Group health plans only offering excepted benefits (e.g., stand-alone dental/vision Previously, self-funded plans could
Slide 11: What Does it Compare?
MHPAEA: What Does it Compare? W H AT D O E S I T C O M PAR E ? Mental Health & Substance Use Medical Surgical Benefits Disorder Benefits Benefits for medical or surgical items that are consistent with generally recognized • IF a health plan provides mental health/substance independent standards of c
Slide 12: Financial-QTL-NQTL
MHPAEA: Financial-QTL-NQTL Three Elements of Parity between MH/SUD Benefits and M/S Benefits • Financial Requirements (e.g., Copays/Deductibles/MOOPs) • Quantitative Treatment Limitations (QTLs) (e.g., Number of Visits) • Non-Quantitative Treatment Limitations (NQTLs) (e.g., Prior Authorizations) »
Slide 13: Current Rules
MHPAEA: Current Rules R E Q U I R E D C L A S S I F I C AT I O N S O F B E N E F I T S U S E D : Inpatient, Outpatient, Emergency Care In-Network In-Network Inpatient, Outpatient, Prescription Drug Out-of- Network Out-of-Network Formularies BROW N & BROW N | 13
Slide 14: Financial Requirements and Treatment Limitations
MHPAEA: Financial Requirements and Treatment Limitations
Slide 15: Financial Requirements and Quantitative Treatment Limitations
MHPAEA F I N AN C I A L R E Q U I R E M E N T S AN D Q U AN T I TAT I V E T R E AT M E N T L I M I TAT I O N S GENERAL RULE: Plans must provide parity in both the financial requirements and quantitative treatment limitations between MH/SUD and M/S benefits in the same classification Financial Requir
Slide 16: No Separate Cumulative Financial Limitations
MHPAEA N O S E PAR AT E C U M U L AT I V E F I N AN C I A L L I M I TAT I O N S F O R M / S V S . M H / S U D MH/SUD must accumulate towards the same cumulative financial requirements under the rules A health plan cannot have two separate financial cumulative amounts (Deductible or MOOP) for M/S and
Slide 17: Terms and Definitions
MHPAEA: Terms and Definitions
Slide 18: Terms and Definitions
Terms and Definitions Term Definition In-patient In-network, In-patient out-of-network, Out-patient in-network, Out-patient out-of-network, Emergency Classification care, Prescription drug formularies No More Are the financial requirements or treatment limitations placed on MH/SUD benefits greater t
Slide 19: MHPAEA: Classifications
a MHPAEA: Classifications
Slide 20: Permitted Classifications (Reminder)
MHPAEA: Permitted Classifications (Reminder) Inpatient, In-Network Outpatient, Emergency Care In-Network Inpatient, Outpatient, Prescription Drug Out-of- Network Out-of-Network Formularies BROW N & BROW N | 20
Slide 21: Classification Rule
MHPAEA: Classification Rule Classifications of benefits used for applying rules: In addition, MHPAEA requires that if the plan covers mental health or substance abuse treatment in any classification, the plan must provide coverage in every/all category classification(s) that medical/surgical benefit
Slide 22: Subclassifications
MHPAEA: Subclassifications AR E T H E R E AN Y " S U B C L AS S I F I C AT I O N S " AL L O W E D U N D E R T H E P L AN ? Office Visits Final regulations provide that office visits may be a separate subclassification from all other outpatient services Multiple Tiers for Network Providers If a plan
Slide 23: No Generalist vs. Specialist Subclassification
MHPAEA N O G E N E R AL I S T V S . S P E C I AL I S T S U B C L AS S I F I C AT I O N Cannot Subclassify Generalists vs. Specialists Generally, there can be no financial requirement/treatment limitation associated with a Generalist vs. Specialist (e.g., Psychotherapist) subclassification for MH/SUD
Slide 24: Substantially All and Predominant Level Test
MHPAEA: Substantially All and Predominant Level Test for Financial and Quantitative Treatment Limitations
Slide 25: Substantially All and Predominant (Financial and QTL)
MHPAEA - Substantially All and Predominant (Financial and QTL) AP P L I C AT I O N O F T H E “ S U B S TAN T I A L LY AL L " AN D “ P R E D O M I N AN T L E V E L " T E S T S Tests Based Upon Spending Associated within a Health Plan Generally, this is based upon the expected "dollar amount of all pl
Slide 26: Substantially All (Financial and QTL)
MHPAEA: Substantially All (Financial and QTL) “ For purposes of financial requirements and quantitative treatment limitations (QTLs), “substantially all” means that the limitation “applies to at least two-thirds of all medical/surgical benefits in that classification. (For this purpose, benefits exp
Slide 27: Substantially All Test (Financial and QTL)
MHPAEA: Substantially All Test (Financial and QTL) W H AT H AP P E N S AF T E R AP P LY I N G T H E " S U B S TAN T I A L LY AL L " T E S T ? Does not satisfy "substantially all" test The financial requirement/treatment limitation cannot apply to MH/SUD benefit Satisfies the "substantially all" test
Slide 28: Predominant Test (Financial and QTL)
MHPAEA: Predominant Test (Financial and QTL) I F P L AN S P O N S O R PAS S E S T H E " S U B S TAN T I A L LY AL L " T E S T, W H AT H AP P E N S N E X T W I T H T H E " P R E D O M I N AN T T E S T ” ? Predominant Test The application of the financial requirement/treatment limitation to MH/SUD in
Slide 29: Definitions
Definitions Predominant: “(1) If a type of financial requirement or quantitative treatment limitation applies to at least two-thirds of all medical/surgical benefits in a classification as determined under paragraph (c)(3)(i)(A) of this section, the level of the financial requirement or quantitative
Slide 30: Predominant Level Test (Financial and QTL)
MHPAEA: Predominant Level Test (Financial and QTL) H O W T O AP P R O A C H T H E " P R E D O M I N AN T L E V E L " T E S T ? Predominant Test: Single Level Predominant Test: Multiple Levels If there is only a single level of If no single level applies to more than 50% of requirement/limitation tha
Slide 31: Predominant Level Test: Single Level Examples
MHPAEA: Predominant Level Test (Financial and QTL) E X AM P L E S – S I N G L E P R E D O M I N AN T L E V E L T E S T Examples of the single "predominant levels" of benefits test: If a plan has two different levels of copayments - $20 (PCP), $40 (Specialist) • 60% of all in-network copayments are p
Slide 32: Predominant Level Test: Aggregate Rule Examples
MHPAEA: Predominant Level Test (Financial and QTL) E X AM P L E S O F " AG G R E G AT E R U L E " F O R P R E D O M I N AN T L E V E L T E S T When doing an analysis of the "predominant levels" of benefits and the “aggregate rule”: If a plan has THREE different levels of copayments $20 (PCP) Preferr
Slide 33: Special Rules
MHPAEA: Special Rules W H AT AR E S O M E S P E C I AL R U L E S U N D E R T H E " P R E D O M I N AN T L E V E L " T E S T ? Units of Coverage Multi-tier Rx Benefits If there are different plan requirements/limits that If different $$ requirements are applied to different tiers apply to different t
Slide 34: Examples of Multi-Tiered Rx Coverage
MHPAEA E X AM P L E S O F M U LT I - T I E R E D R X C O V E R A G E U N D E R T H E P R E D O M I N AN T L E V E L T E S T Multi-tiered Rx coverage under the "predominant levels" of benefits test: A plan applies the same financial requirements for use of a prescription drug benefit in both the M/S
Slide 35: Non-Quantitative Treatment Limitations and the NQTL Comparative Analysis
MHPAEA: Non- Quantitative Treatment Limitations and the NQTL Comparative Analysis
Slide 36: Non-Quantitative Treatment Limitations
Non-Quantitative Treatment Limitations GENERAL RULE: Plans must also provide parity with respect to non-quantitative treatment limitations between medical/surgical benefits and mental health/substance use disorder benefits in the same classification Non-Quantitative Treatment Limitations Examples: M
Slide 37: Final Rules
MHPAEA: Final Rules Final Rules were Released in September 2024 and Focused on the Comparative Analysis of NQTLs for MH/SUD Benefits and M/S Benefits Generally, a plan must ensure that, as written and in operation, any NQTL that is applied to MH/SUD benefits is comparable to, and applied no more str
Slide 38: MH/SUD vs. M/S Definition
MHPAEA: MH/SUD vs. M/S Definition Adoption of Independent Medical Standards for NQTLs Effective January 1, 2025 As it relates to the terms “medical/surgical benefits,” “mental health benefits” and “substance use disorder benefits,” the final rules state that the plan/coverage must define these condi
Slide 39: MH/SUD vs. M/S Definition
MHPAEA: MH/SUD vs. M/S Definition All or Nothing Approach to Definitions of MH/SUD under NQTL rules The final rules also state that if a plan/coverage “defines a condition or disorder as a mental health condition or substance use disorder, plans and issuers...must treat all benefits for the conditio
Slide 40: Treatment Limitations
MHPAEA: Treatment Limitations Complete Exclusion from a Plan is not a Treatment Limitation “…exclusion of all benefits for a particular condition or disorder is not [considered] a treatment limitation for purposes of the definition” Potential Meaning This could generally mean that plans may exclude
Slide 41: NQTL – No More Restrictive Requirement
NQTL – No More Restrictive Requirement
Slide 42: No More Restrictive Requirement
MHPAEA: No More Restrictive Requirement NQTLS AND THE NO MORE RESTRICTIVE REQUIREMENT “ “…a group health plan (or health insurance coverage offered by an issuer in connection with a group health plan) may not impose any NQTL with respect to mental health or substance use disorder benefits in any cla
Slide 43: NQTL Comparative Analysis: No More Restrictive Design and Application
MHPAEA NQTL Comparative Analysis: No More Restrictive 1 Design and Application Plans must generally satisfy these two requirements under the “no more restrictive” rule: 2 Relevant Data Evaluation BROW N & BROW N | 43
Slide 44: NQTL Comparative Analysis: No More Restrictive
MHPAEA NQTL Comparative Analysis: No More Restrictive Effective for PYs beginning on or after January 1, 2025 Design and Application Requirement: For a plan to meet the “no more restrictive” standard, it must illustrate its compliance by showing that the plan’s “processes, strategies, evidentiary st
Slide 45: Reasoning Behind NQTL
MHPAEA NQTL: Reasoning Behind NQTL Effective January 1, 2025 Health Plans Must Perform Comparative Generally, a plan must ensure that, as written Analysis on NQTL and in operation, any NQTL applied to MH/SUD benefits is comparable to, and applied no more stringently than, the M/S benefits offered un
Slide 46: Six Elements of NQTL Analysis
MHPAEA: Six Elements of NQTL Analysis Six elements must be contained in NQTL Comparative Analysis (Effective for PYs beginning on or after 1/1/25, except Relevant Data Requirement effective for PYs beginning on or after 1/1/26). A demonstration of comparability A description of the NQTL and stringen
Slide 47: NQTL: Relevant Data Evaluation
MHPAEA NQTL: Relevant Data Evaluation Effective for PYs beginning on or after January 1, 2026 Relevant Data Evaluation: Material Differences in Access to Networks or Network Plans must compare/review quantitative Composition outcomes data, such as “in-network and out-of-network utilization rates (in
Slide 48: NQTL – Meaningful Benefits Standard
NQTL – Meaningful Benefits Standard
Slide 49: NQTL: Meaningful Benefits Standard
MHPAEA NQTL: Meaningful Benefits Standard Effective January 1, 2026 Presumption of Discrimination Meaningful Benefits Standard: To offer “meaningful benefits” for a MH/SUD condition or disorder, If any benefits for a MH/SUD the plan must, at a minimum, cover benefits for that condition or condition
Slide 50: Example of Meaningful Benefits Standard
MHPAEA NQTL: Meaningful Benefits Standard Example of Meaningful Benefits Standard A plan covers treatment for autism spectrum disorder (ASD) (a MH condition). The plan covers outpatient, out-of-network developmental screenings for ASD, but excludes all other benefits for outpatient treatment for ASD
Slide 51: MHPAEA and ERISA Fiduciary Duties
MHPAEA and ERISA Fiduciary Duties
Slide 52: ERISA Plans
ERISA Plans All private plans are subject 1 Church Plans to ERISA. These are two kinds of health plans not subject to ERISA: 2 Governmental Plans BROW N & BROW N | 52
Slide 53: ERISA and Fiduciary Responsibilities
MHPAEA: ERISA and Fiduciary Responsibilities E R I S A A N D M H P A E A A N A LY S I S Effective first day of PYs beginning on or after January 1, 2025 • ERISA - NQTL comparative analysis needs to include a certification by a "named fiduciary" as part of the Findings and Conclusions. Certification
Slide 54: Action Plan
Action Plan
Slide 55: Compliance Steps
Compliance Steps Group health plan sponsors should determine whether the plan is subject to MHPAEA, or if exemptions may apply (e.g., the plan 1 qualifies as an excepted benefit). Review financial and quantitative treatment limitations (QTLs) to ensure the plan design does not contain any restrictio
Slide 56: Resources
Resources
Slide 57: HRCI and SHRM Credits
HRCI and SHRM Credits This Program, ID No. 688725, has been approved for 1.00 HR (General) recertification credit hours toward aPHR , aPHRi , PHR®, PHRca®, SPHR®, GPHR®, PHRi and SPHRi recertification through HR Certification Institute® (HRCI®). Brown & Brown is recognized by SHRM to offer Professio
Slide 58: Find your solution at BBrown.com
Find your solution at BBrown.com DISCLAIMER: Brown & Brown, Inc. and all its affiliates, do not provide legal, regulatory or tax guidance, or advice. If legal advice counsel or representation is needed, the services of a legal professional should be sought. The information in this document is intend
Brown & Brown — Conference Presentation (January 2025) on 6ix