Sept. 23 Federal Update: A Vital Step for Mental Health Parity

On Sept. 9, President Joe Biden and Vice President Kamala Harris announced a rule that is expected to significantly advance parity for mental health care coverage. The protections will ensure mental health care coverage for 175 million Americans is on par with their physical health care coverage.

As President Biden stated, “Mental health care is health care. But for far too many Americans, critical care and treatments are out of reach. Today, my Administration is taking action to address our nation’s mental health crisis by ensuring mental health coverage will be covered at the same level as other health care for Americans. There is no reason that breaking your arm should be treated differently than having a mental health condition.”

The rule builds on the bipartisan Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). MHPAEA fortified key protections to ensure group health plans and health insurance issuers that provide mental health or substance use disorder benefits do not enact less favorable benefit limitations compared to their medical/surgical benefits. 

The rule requires health plans to evaluate their mental health care access, including assessing provider networks, payment rates for out-of-network providers, as well as using prior authorizations. It must then act accordingly to provide needed changes, potentially by expanding its network of mental health professionals or reducing bureaucratic hurdles. Health plans are also required to use similar factors in setting out-of-network payment rates for mental health and substance use disorder providers as they would for medical providers.

The above protections, and the inclusion of non-federal governmental health plans, are critical steps to increasing the accessibility and affordability of mental health care. For additional information, please see the U.S. Department of Labor’s general fact sheet as well as explanations for participants/beneficiaries, providers, and plans and issuers. The White House has also made a fact sheet available.

Addressing Food Distribution Shortages in Tribal Communities

On Sept. 11, the House Committee on Appropriations held a Joint Oversight Hearing titled “Severe Food Distribution Shortages in Tribal and Elderly Communities.” Representatives discussed the shortage crisis caused by the U.S. Department of Agriculture (USDA)’s consolidation of warehouses supporting the Food Distribution Program on Indian Reservations (FDPIR) and the Commodity Supplemental Food Program. The programs collectively serve approximately 800,000 individuals, ensuring dietary staples are received monthly.

Witnesses detailed how the consolidation, and resulting food shortages, jeopardized the welfare of their communities through extended delivery delays, missing items, and receipt of damaged and expired food. The USDA offered temporary solutions, but most were inaccessible to tribes. While temporary funding provides short-term relief, it does not address the inherent problems that stem from relying on a singular warehouse and distribution center.

Recommendations included a permanent expansion of the FDPIR pilot program, including by expanding the program to the Commodity Supplemental Food Program. The Honorable Darrell G. Seki Sr., chairman of the Red Lake Band of Chippewa Indians, additionally recommended moving to a regional sourcing model as well as establishing an automatic tracking system for deliveries.

USDA Secretary Tom Vilsack affirmed the USDA’s commitment to ensuring access to safe and nutritious foods as well as better partnering with tribal nations to empower tribal food sovereignty. Secretary Vilsack acknowledged past failures and discussed efforts to resume and improve programs immediately as well as in the short and long-term future. He further echoed the importance of consistent communication and outreach through consultations and feedback, especially in developing a more resilient, reliable distribution system capable of meeting their partners’ needs.

Committee members stressed the importance of accountability considering the harm tribal communities faced and the failure to fulfill responsibilities to tribes. They collectively expressed the unacceptability of inadequate access to nutrition and the need for corrective action.

The Inflation Reduction Act and Reduced Health Care Costs for Americans

Sen. Wyden (D-Ore.) detailed the key protections the Inflation Reduction Act (IRA) has offered in increasing the affordability of health care, including price gouging penalties, the out-of-pocket cap on prescriptions through Medicare Part D, and lower premiums through enhanced tax credits. He stressed the importance of further protecting and strengthening its terms.

Ranking Member Crapo (R-Idaho) spoke of the potential consequences of the IRA, including its impact on research and development, citing the 21 medicines and 36 research programs that have been discontinued since the law’s enactment. While he affirmed the importance of capping out-of-pocket costs for seniors’ prescriptions, he stressed hidden costs, warning how tax credits would grow the deficit. Crapo affirmed his commitment to bipartisan solutions that improve health care choice, affordability, and reliability.

Theo Merkel, Director of the Private Health Reform Initiative, also highlighted concerns about the financial implications of permanently extending the premium tax credit, estimating it would add $415 billion to ACA spending over a decade. He warned that enhanced coverage could lead to reduced employer-provided insurance and suggested improving risk adjustment and direct cost-sharing reduction payments for eligible enrollees.

Kirsten Axelsen, a Nonresident Fellow at the American Enterprise Institute, echoed these concerns, cautioning that reduced revenue could hinder investments in drug development for critical areas like rare diseases and senior medications. She advocated for greater transparency in drug selection for the Medicare Drug Negotiation Program, emphasizing the need for oversight of Medicare Part D formularies to ensure beneficiary access to affordable options.

Rena Conti, Ph.D., an Associate Professor at Boston University, highlighted that provisions in the Inflation Reduction Act (IRA), including negotiation, inflation rebates, and redesign of Medicare Part D, are actually projected by the Congressional Budget Office to save the federal government $58 billion by fiscal year 2031 without harming pharmaceutical innovation. She noted that the growth in sales of COVID-19 therapeutics and vaccines could further stimulate innovation, while also increasing coverage and profits for pharmaceutical companies.

Jeanne M. Lambrew, Ph.D., Director of Health Care Reform at the Century Foundation, supported Conti’s findings, citing nonpartisan research that demonstrates how the IRA’s health tax credit provisions enhance coverage and lower costs for consumers. Lambrew urged for the extension and expansion of the IRA, emphasizing the financial burdens Americans would face without healthcare coverage and the negative impact on healthcare providers.

Judy Aiken, a 70-year-old retired nurse, affirmed the challenge to afford the medication needed to manage chronic conditions she experiences. The costs significantly impacted her quality of life, straining her family’s budget until home repairs became unaffordable. Aiken shared the reduction in price and cap on out-of-pocket expenses signify she no longer needs to choose between her health and financial stability.

Committee members discussed the potential impact of the IRA on Medicare beneficiaries, emphasizing the need to end price gouging and increase access to care. They also expressed concern of the potential for premiums to rise while centralizing the experiences of their constituents.

Key Legislation Considered in the U.S. House of Representatives

House Committees held hearings to markup pending legislation. A few of the bills heard last week are discussed below.

U.S. House Committee on Ways and Means

• The Educational Choice for Children Act of 2024 provides taxpayers a tax credit for donations and charitable contributions to scholarship granting organizations. The scholarships are reserved for students in households with incomes at or below 300% of the median income level in their area. This bill passed the Committee with 23 Representatives voting in favor and 16 against.

• The Find and Protect Foster Youth Act requires the U.S. Department of Health and Human Services (HHS) to evaluate protocols utilized by states to determine the location of missing foster youth. The bill further requires HHS to provide states with technical assistance in determining children’s experiences while they are missing from foster care, including providing screenings for sex trafficking and determining appropriate services.

U.S. House Committee on Education and the Workforce

•  The Jenna Quinn Law of 2024 amends the Child Abuse Prevention and Treatment Act to redirect grant funds toward training and educating school employees, students, and community members on preventing, recognizing, responding to, and reporting child sexual abuse among primary and secondary school students. All committee members voted in favor of this bill.

• Parental Rights Over the Education and Care of Their Kids Act, or the PROTECT Kids Act, requires any federally funded elementary or middle school to seek and acquire parental consent before changing their child’s pronouns, gender markers, or preferred name on any school form. The requirements also extend to allowing a child to change their sex-based accommodations, such as locker rooms or bathrooms. This bill was voted in favor by 22 Representatives, while 12 voted against.

• The Healthy Competition for Better Care Act bans anti-competitive terms in facility and insurance contracts that limit access to higher quality, lower cost care. The bill is estimated to save $3.2 billion in taxpayer dollars, according to the Congressional Budget Office. The committee voted in favor of advancing the bill.

• The Transparent Telehealth Bills Act of 2024 amends the Employee Retirement Income Security Act of 1974 to prohibit increased payments for telehealth services provided through hospital facilities. The bill unanimously passed the House Committee.

Energy and Commerce

• The Kids Online Safety Act establishes protections to prevent or mitigate harm from social media platforms, including through default safety settings and increased transparency for parents. The bill was approved by the Innovation, Data, and Commerce Subcommittee and will be sent to the Committee on Energy and Commerce.

• The Children and Teens’ Online Privacy Protection Act prohibits online companies from collecting personal information from users under 17 years of age without consent. It also bans targeted advertising to children and teens and establishes a Youth Marketing and Privacy Division at the Federal Trade Commission. The bill passed Committee with a strong majority of Representatives in favor.

• A joint resolution was introduced to prevent a federal rule that would establish minimum staffing standards for long-term care facilities and require transparency in reporting Medicaid institutional payments from being enforced. The resolution passed without amendment, with 21 Representatives voting in favor and 18 against

• The Telehealth Modernization Act of 2024 authorizes alternative sites of services and expanded practitioners to provide telehealth services under Medicare, as determined by the Centers for Medicare & Medicaid Services. The bill was unanimously voted in favor of by the Committee.

The U.S. House of Representatives also considered the Supporting America’s Children and Families Act, which reauthorizes and amends Part B of Title IV of the Social Security Act. The bill increases the availability of community-based resources for families, including through family resource centers. The bill further centers lived experience, family preservation, and continuous improvement. The legislation was passed by a voice vote, and all representatives who spoke were strongly in favor. The Senate has since read the bill and referred it to the Committee on Finance.

Sector Updates from the Judiciary

Revisiting the Denial of Benefits for Wilderness Therapy

The US District Court for the District of Utah recently returned a lawsuit regarding the coverage of wilderness therapy to a lower court for reevaluation. United Healthcare denied coverage for wilderness therapy because of its status as an unproven treatment. However, the Court maintained their denial of benefits was arbitrary because United Healthcare didn’t provide a sufficient explanation and analysis.

The decision upholds a key provision of the Employee Retirement Income Security Act, which requires United Healthcare to provide adequate notice with specific reasons for the denial in plain language for participants. By ruling in favor of the family, the court fortified precedent mandating insurance companies include explanations of the scientific or clinical judgment used to deny the benefits.

Extended Statute of Limitations

A home health care company’s lawsuit was previously dismissed because it was filed after the six-year statute of limitations set by the Administrative Procedure Act (APA). It was reinstated, however, after the Supreme Court issued a landmark ruling in Corner Post, Inc. v. Board of Governors of the Federal Reserve System. The verdict maintains the statute of limitations does not begin until an organization is harmed by a final agency action. One of the judges dissented in part, arguing the statute limitations do not begin until the business is created.

The health care company’s lawsuit surrounds a regulation issued by the Department of Labor in 2013, which clarifies which home care workers meet the law’s minimum wage and overtime pay requirements under the Fair Labor Standards Act. Previously, the lawsuit was dismissed as the court agreed with the Department of Labor that the six-year statute of limitations began when the final rule was issued in 2013.

By returning the lawsuit to a lower court, the 3rd U.S. Circuit Court of Appeals demonstrated a key potential of Corner Post to allow organizations to challenge harmful regulations beyond the APA’s statute of limitations for civil actions.

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